Paris (AFP)

Energy prices keep increasing as winter approaches, like gas prices on Monday, forcing the government to seek remedies to ease the burden on purchasing power within a few months of the presidential election.

Regulated gas prices applied by Engie to nearly 3 million households will once again jump, by 12.6% including tax on October 1, in the wake of the rise in market prices, the regulator announced on Monday.

"This development is the result of the historic rise in gas prices on the world market which is reflected in the supply costs of the gas supplier Engie", explains the Energy Regulatory Commission (CRE).

"This development results from the historic rise in gas prices on the world market which is reflected in the supply costs of the gas supplier Engie", according to the Energy Regulatory Commission ERIC PIERMONT AFP / Archives

These regulated tariffs, updated every month, have experienced a series of strong increases recently.

They increased again by 8.7% on September 1, after more than 5% in August and nearly 10% in July.

Gas prices are at very high levels in Europe due to various factors: low storage, strong demand for liquefied natural gas (LNG) in Asia and the inability of Norway and Russia to increase their deliveries, underlines CRE .

Demand is also driven by the global economic recovery, thanks to the improvement of the situation on the front lines of the Covid-19 pandemic.

"Wholesale gas prices for future products currently indicate a continuation of these very high price levels through fall 2021 and winter 2021-2022, then decline from spring and summer 2022, before a return to normal for the year 2023 ", anticipates the CRE.

- "Smoothing" in sight?

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She says she is working with the public authorities on "solutions to get through the winter and take advantage of the drop in wholesale prices expected from the spring".

In other years, a "smoothing" mechanism had been put in place to limit increases in winter.

The subject of purchasing power is highly sensitive for the government, while it is the rise in fuel prices that triggered the movement of "yellow vests" in the fall of 2018.

Faced with the strong evolution of gas prices - but also potentially electricity next year - the government recently announced that nearly six million low-income households would benefit from an exceptional check for 100 euros in December.

The government had "anticipated this increase" with this check, argued Monday in the entourage of the Minister of Ecological Transition, Barbara Pompili.

"We remain vigilant and are studying other avenues to protect the French in the face of these increases," adds one.

The Minister of Ecological Transition Barbara Pompili at the Elysee Palace in Paris on July 28, 2021 Bertrand GUAY AFP

"To increase the energy check is today only a macronist smoke", had criticized the leader of rebellious France, Jean-Luc Mélenchon, proposing "a shock treatment in urgency: the freezing of the prices".

For the rest, the timetable is explosive for the government: the CRE must normally propose an increase in regulated electricity tariffs at the beginning of next year, in the middle of winter and only a few months before the presidential election.

This increase could be very significant because of the current soaring prices on the wholesale markets, which follow in particular those of gas, even if France mainly produces its electricity with nuclear power and hydropower.

The UFC-Que Choisir fears a 10% increase in prices.

Last week, the Minister of the Economy, Bruno Le Maire, denounced an "obsolete" system to be "thoroughly reviewed" concerning the single European electricity market, deeming "absurd" that gas dictates prices for electricity produced mainly from other resources.

© 2021 AFP