Electricity: regulated tariffs should fall in 2025, but…
On Wednesday, September 11, the Energy Regulatory Commission (CRE) made an announcement that should please just over 22 million French people. As of February 1, 2025, the bill for subscribers to regulated tariffs (TRVE) should decrease “of at least 10%“. Good news, the first of its kind since the energy crisis that began in 2022, to be put into perspective. Especially since it is only a “forecast” for Emmanuelle Wargon, president of the CRE.
A drop in prices on the wholesale market
Nicolas Goldberg, energy expert for the firm Colombus Consulting, explains: “If we had very high prices, it is because the electrical system went off the rails, because hydraulic stocks were low and because we experienced a gas crisis. Since the electricity crisis is over, this is having an impact on market prices and regulated tariffs.“Currently, the price of MWh is between €60 and €70, far from the €40-50 before the crisis, but well below the record of €1,000.
Thus, the drop in the price of electricity on the wholesale market should make it possible to soften many bills. However, if there will be no increase in regulated tariffs until next February, the 1% increase in the tariff for using the public electricity network (Turpe), initially planned for August, will apply in November. This concerns the 17.5 million households and businesses that benefit from a market offer. This increase will be applied in February 2025 in order to gain clarity and stability on the user side when the tariffs are recalculated.
A drop that hides the forest
However, this anticipated 10% drop will not be enough to return to the prices practiced before the start of the energy crisis. This is indicated by Antoine Autier, head of studies and specialists in energy issues at UFC Que Choisir: “Even if we apply a 10% reduction next February, it will still be 27% more than two years ago.“He also specifies”Today, an average consumer who uses electricity for heating pays an average annual bill of around 2,250 euros, i.e. 40% more than at the beginning of 2023..”
For him, the method of calculating the regulated tariff is the main concern to be resolved. He thus denounces: “Today, the method of calculating the regulated tariff gives more than 50% of space to the prices of the electricity markets, that is to say that it is not the cost of production in France which determines the price paid by consumers.“
And to add: “This is completely abnormal, because consumers should pay an electricity price, at least on the regulated tariff, which corresponds to the costs of producing electricity in France.“
He also points out that the electricity produced in France, a country independent of its neighbours in this respect, is largely decarbonised and produced much cheaper than the prices charged on the market. He therefore concludes: “If we had rules in France that set the method of calculating regulated tariffs in such a way that they correspond to the production costs of electricity in France, in particular the production costs of EDF's nuclear power, consumers would pay much lower prices than those currently paid and those they will pay in February 2025.“
