Power Grid

09 Nov 2023

EDF, French Govt Near Deal on Power Prices- Source Close to Govt

09 Nov 2023  by reuters   

The logo is seen prior to the presentation of the French state-owned utility EDF 2023 half-year results in Paris, France, July 27, 2023. REUTERS/Benoit Tessier/File Photo Acquire Licensing Rights

PARIS, Nov 8 (Reuters) - State-controlled power group EDF and the French government are nearing an agreement over future power prices, a source close to the government said.

A deal would end months of stand-off between the nuclear power producer, which is eager to maximise revenues to fund investments, and the government, which wants to keep electricity bills for French households and businesses as low as possible.

The stand-off had cast doubts over the future of EDF CEO Luc Remont, appointed a year ago by President Emmanuel Macron, with some EDF managers and board members fearing he may resign if he felt the state was limiting his ability to turn around EDF.

EDF declined to comment.

In a hearing before the Senate on Wednesday, Remont said that EDF and the government were discussing setting future reference prices for electricity at around the 70 euros-per-Megawatt hour (MWH) level.

He said negotiations with the government were "intense."

The source close to the government told Reuters that under the likely agreement between the two sides the state would tax EDF's revenues beyond certain thresholds and redistribute that money to keep power bills low.

The source added that EDF wanted some guarantee clause that would allow it to renegotiate the agreement if energy market conditions worsened.


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