EDF and the perverse effects of tariff regulation


DECRYPTION – The Competition Authority had already highlighted the ineptitude of this system in 2019.

The health of the main player in the electricity sector is particularly influenced by market regulation. Arenh (regulated access to historical nuclear electricity), sold at 42 euros per megawatt hour – a price unchanged for ten years – to alternative suppliers prevents EDF from taking full advantage of market prices. The device, however, protects businesses and customers against soaring prices.

EDF must indeed sell 100 terawatt hours (100,000 megawatt hours) to its competitors at low prices within the framework of the Arenh. This is the tip of the iceberg. The invisible part? The electrician must replicate the effect on the tariffs applied to his own customers. In the end, it is not 100 but 250 terawatt hours that EDF must invoice at 42 euros, on a production of 300 TWh planned for this year. This widens EDF’s opportunity losses when electricity peaks on the wholesale market.

Conversely, EDF takes advantage of the limits of this regulation. To allow…

This article is for subscribers only. You have 67% left to discover.

Cultivating your freedom is cultivating your curiosity.

Keep reading your article for 1€ the first month

Already subscribed? Login



Source link -93