Energy prices: Bruno Le Maire wants to "temper the logic of the market" in Europe

Europe 1 with AFP 19:16, 08 November 2021

Despite the skepticism of other states, France still wants to reform the European electricity market, Economy Minister Bruno Le Maire said in an interview with AFP on Monday. He defends the need to "temper the logic of the market" for the end consumer. "There is a need to act to protect consumers" from a price increase which will be "sustainable", underlined Bruno Le Maire, before a meeting of European finance ministers on Monday and Tuesday.

France is proposing three measures, including the creation of an "automatic stabilizer" mechanism for the price of electricity, which "makes it possible to transfer the gains" that a producer can make when the price of energy is high on the market. to the supplier who "then passes them on to the consumer, individual or company".

Large "unacceptable" variations

Bruno Le Maire also pleads for the establishment of long-term low carbon contracts for companies, and the obligation to offer consumers a stable price offer. "No European citizen can accept to have variations of 20, 30, 35% of his energy bill. It is simply unbearable", he added on his arrival in Brussels, Monday afternoon. . The French minister stressed that these proposals were supported by Spain, Greece and the Czech Republic.

But a majority of countries remain reluctant.

"I do not believe that this will solve the immediate problem that we have", estimated Monday the Dutch Minister of Finance, Wopke Hoekstra, judging "more rapid and effective" the devices of support to the households already adopted by several countries, of which France. .

France wants to develop the retail market

Last week, at an extraordinary European energy summit in Luxembourg, the French idea of ​​reforming the electricity market was received freshly by European energy ministers. Eleven countries (Germany, Austria, Luxembourg, Denmark, Estonia, Finland, Ireland, Latvia, Netherlands, Belgium, Sweden) had thus spoken out against any reform, judging that the current crisis depends on cyclical "global factors".

The European Commission, for its part, deemed "effective" the current system known as "marginal pricing", where the price of the last unit of electricity production to start in Europe (often a gas plant) sets the market price, considering that it encourages the development of renewable energies, at low production costs.

If France "does not want to return" to the functioning of the wholesale market, intends to reassure Bruno Le Maire, it wishes to develop the retail market for individuals and businesses, including for environmental reasons.

Bruno Le Maire believes that "the conjunction of the exhaustion of fossil fuels and the increase in the carbon price will automatically lead structurally to an increase in the price of fossil fuels".

To accelerate electrification, "the decarbonization of the economy and the ecological transition", he therefore considers it necessary to "decouple" the price of electricity from the price of fossil fuels.