French household energy bills and heating costs, Digi Mart USA News (France): Energy bills are weighing more heavily on French household budgets, and the coming winter is expected to be particularly difficult. After an increase of 18% over the past three months, the benchmark retail gas price is expected to rise by nearly 5.8% on December 1.
According to the energy-info barometer of the national energy ombudsman, 34% of respondents said they had had difficulty paying certain electricity or gas bills, compared with 18% in 2020, and 89% said they were worried about this expense. Among people under 35, 55% said they had struggled to pay some bills.
One respondent, Sabine, a civil servant in her fifties, said her heating bill had risen sharply, from 65 to 70 euros to more than 120 euros per month over five years. She said she cannot live in her apartment in winter because it costs too much, so she stays with her partner, who heats with wood.
Philippe Charlez, an engineer, author and energy expert, said these trends depend on international circumstances over which France has very little influence. He cited the war in Ukraine, which continues to affect prices, and persistent tensions in the Middle East, which he said particularly concern him.
According to figures cited by Charlez, the wholesale price of a megawatt-hour of gas rose from 30 euros in February to 105 euros today, and oil prices increased by 60%. He said he had warned on air since July, as gas prices rose, that this would create a major surge in costs from December.
Charlez also argued that energy prices are not driven solely by international tensions. He said electricity is poorly suited to a market, because it must be adjusted in real time to demand and cannot be stored, so supply and demand must be balanced every quarter hour.
He explained that electricity prices remain closely tied to gas prices, even in France, where nuclear power accounts for a large share of production. When demand rises, particularly in the morning and evening, gas-fired plants may be brought in to supplement nuclear output.
He noted that hydroelectric output is currently constrained because reservoirs are not fully filled.
Charlez also discussed the creation of ARENH (Regulated Access to Historic Nuclear Electricity) in 2010, under President Nicolas Sarkozy. The mechanism required EDF to sell part of its nuclear electricity to competitors at a regulated price.
He considers this contestable, saying EDF was required to sell nearly 25% of its electricity production at a near loss, which was then resold by alternative suppliers, and he argues this shows electricity is not suited to a liberal market.
