• On Wednesday, Engie's regulated sales tariff (TRV) for natural gas increased by an average of 8.7%.

  • An increase largely linked to the economic recovery, as explained by Francis Perrin, research director at Iris specializing in energy strategies and policies.

  • While European stocks are at their lowest, a shortage is possible - but still avoidable - this winter, he believes.

A further rise in gas prices at the beginning of September.

This Wednesday marks an 8.7% increase in Engie's regulated sales tariff (TRV) for natural gas.

This increase is 2.7% for customers using gas for cooking, 5.5% for those who have dual use, cooking and hot water, and 9% for homes heated with, said the Energy Regulatory Commission (CRE) in a press release.

But what is the reason for this increase, which is not an isolated case - regulated prices have increased by 15.8% since January 1, 2019 -?

Is it specific to France?

To understand this,

20 Minutes

interviewed Francis Perrin, research director at Iris specializing in energy strategies and policies.

Is this rise in gas prices linked only to France?

France is the illustration of a more general tendency to increase tariffs.

Its main cause is the strong economic recovery in 2021. And that obviously goes far beyond our country.

Of course, we had an extremely difficult year in 2020, with a global recession.

And this year, we expect growth of 5-6% on average, which is very high.

In this context, the prices of many raw materials are increasing: natural gas, agricultural products, mining resources, etc.

What is the situation in Europe?

Countries that export gas and LNG, liquefied natural gas, can in some cases choose between different markets to sell it.

And when they do this type of arbitrage, they are looking closely at one key thing: the price.

However, in recent times, LNG prices on Asian markets are higher than those on the European market.

So that some sellers have arbitrated in favor of the Asian market.

What is the situation of European gas stocks?

In Europe, we have natural gas storage at a very low level.

We are in summer, so we can tell each other that it is not very embarrassing.

But the tanks need to be filled for the winter season, so now is the time to rush to the market to buy gas.

Not to consume it, but to store it.

And when you have a number of players rushing to fill the stocks, it obviously has an impact on the prices.

How much is France dependent on imports?

We import 99% of the natural gas we consume.

For the European Union, we are approaching two-thirds.

We know very well that the EU, in general, is not a massively producing area of ​​natural gas.

Oil either.

Can there be a risk of shortage this winter?

As European stocks are at very low levels, this is a cause for concern, but not for panic.

This is why some gas operators are rushing to try to replenish their stocks, precisely to avoid a risk of shortage in the coming months.

We can solve this situation but between summer and winter, things happen very quickly and gas cannot be bought overnight.

Everything is getting ready.

So yes, there is a risk of a shortage but for now, the visible effect is that the prices are going up.

And this impacts the budget of the French ...

Fuel, gas, electricity… These are very sensitive prices, often very political.

We can hardly do without it, so that means we have a little less money to do other things.

This can help increase political and social discontent.

And it is clear that the French government does not consider this a small subject.

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Engie: The regulated gas tariff will increase by 8.7% in September

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