Ihe current tensions between European countries over the organization of the electricity market do not reflect the opposition between nuclear-obsessed French technocrats and fanatically hostile German Greens. Beyond lobbies and inevitably uncertain technical expertise on an investment horizon that is measured in decades, these frictions reflect societal choices. The history of the development of electricity reminds us of this.
We sometimes forget that electricity was first a local energy. Because its transport involved high losses, it was initially produced in coal-fired power stations in the immediate vicinity of the places of consumption which were, initially, the cities. Installing a network being costly, local electricity companies achieved significant economies of scale which allowed them to acquire monopoly positions.
But, from 1906, a law forced them to obtain municipal concessions, the negotiation of which defined obligations, particularly in terms of tariffs and territorial coverage. Thanks to technical progress, prices are falling rapidly and consumption is increasing. The possibility of distributing electricity in small quantities (as opposed to the massive production of steam engines) offers small businesses and homeworkers (for example seamstresses) productivity gains and less hardship, without having to submit to concentration in the factory. The emerging electrical machinery industry transformed both work and domestic life.
In the interwar period, the distribution of electricity gradually extended to the countryside. Under the impetus of two large groups (L’Energie Industrielle and L’Union d’Electricité), the electrical industry concentrated rapidly after 1920. Economies of scale in high-voltage distribution made it possible to overcome the problems of supply of a non-storable good and to concentrate production, in particular with hydroelectric dams. The financial and technical concentration of the large monopolistic networks reduces the negotiating capacity of public authorities, especially local ones.
The experts tear each other apart
The nationalization of 1945 was not only a break with financial capitalism, claimed by the National Council of Resistance to give the State the capacity to control the economy, but also the recognition of the situation of “natural” monopoly. of the electrical system. EDF, which merges the major producers and the distribution, in fact completes the construction of a unified national market. With the financial support of the State, EDF continues the process of technical concentration with ever larger dams, then the nuclear program.
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