Electricity Prices: Energy-Intensive Industries Pressure EDF for Fair Contracts

Energy-intensive industries in France, currently renegotiating their commercial agreements with EDF, are putting pressure on the energy giant. They criticize EDF for not offering “balanced” contracts and demand more “visibility” in pricing.

Nicolas de Warren, president of Uniden, an association representing 36 energy-intensive industries consuming over 70% of France’s industrial energy, revealed to AFP that negotiations have stalled in recent months despite over a year of discussions.

While acknowledging some progress in structuring the agreements, de Warren lamented the lack of advancement since the last meeting at the Ministry of Industry two months ago. EDF has not yet responded to AFP’s request for comment.

Energy-intensive industries have benefited from a preferential rate for nuclear electricity, known as Arenh, which will expire at the end of 2025.

EDF, burdened by substantial debt and facing significant investments in new reactors, is proposing long-term contracts to its largest customers. These contracts offer what EDF considers preferential rates in exchange for a share in past investments in its existing nuclear fleet. These are known as nuclear production allocation contracts (CAPN).

One of the main sticking points is the definition of production costs. EDF includes a portion of the financing for future nuclear projects, which significantly increases the cost compared to calculations by the Energy Regulatory Commission (CRE), the sector’s watchdog.

Another point of contention is the “degree of exposure to the operational risks of the nuclear fleet” and the variability of its production due to technical or economic factors. Uniden members are reportedly willing to assume “part of this risk.”

De Warren emphasized that their sole focus is on competitiveness and long-term visibility, neither of which is currently offered by EDF’s proposals. As of now, EDF has signed five contracts with energy-intensive companies, totaling 10 TWh.

This stance by energy-intensive industries follows a Senate report advocating for “targeted tax cuts” on electricity prices to protect consumers. The report also suggests implementing contracts for difference (CfD), which would guarantee a price or require surplus payments to the state depending on market prices. Uniden views this as a favorable option to supplement its members’ electricity supply.

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