(Bloomberg) — French Finance Minister Bruno Le Maire said the state’s mechanism limiting the cost of electricity for consumers could last another two years as wholesale prices remain high.
(Bloomberg) — French Finance Minister Bruno Le Maire said the state’s mechanism limiting the cost of electricity for consumers could last another two years as wholesale prices remain high.
France has limited the rise in electricity prices to 4% in 2022 and 15% this year in an effort to protect consumers with a so called “tariff shield.”
“I will give us two years, to the start of 2025, to exit the electricity shield,” Le Maire said on LCI television. “Exiting prices shields should be done gradually so as not to worry citizens.”
Wholesale prices remain high and Electricite de France SA’s energy production is a bit lower than expected, justifying the continuation of the shield for electricity prices, Le Maire said. For natural gas, however, the government will end its price-capping measure this year as prices have fallen below €50 a megawatt-hour.
“There is no reason to keep a gas price shield when prices are back at pre-crisis levels,” he said.
The government estimates that the various price limiting mechanisms have saved an average household between €180 and €200 a month. In 2022, the state spent around €24 billion on its price shield, a large part of which was financed by taxation of what was termed super-profits of energy companies.
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