News Article

France and Germany arm wrestle over EU electricity reform

wind power

PARIS -

Despite record temperatures this October, Europe is slowly shifting towards winter - its second since the Ukraine war started and prompted Russia to cut gas supplies to the continent.

After prices surged last winter, when gas and electricity bills “nearly doubled in all EU capitals”, the EU decided to take action.

In March, the European Commission proposed a reform “to boost renewables, better protect consumers and enhance industrial competitiveness”.

However, France and Germany are struggling to find a compromise and the clock is ticking as European energy ministers prepare to meet on 17 October in Luxembourg.


The controversy around CFDs
At the heart of the issue are contracts for difference (CFDs).

By providing a guaranteed price for electricity, CFDs aim to support investment in renewable energy projects.

France - having 56 nuclear reactors - is lobbying for nuclear energy to be included in the CFDs, but this has caught the withering eye of Germany.

Berlin suspects Paris of wanting an exception that would give its industry a competitive advantage and plead that it should only apply to new investments.


France wants ‘to regain control of the price’
The disagreement is at the heart of the bilateral talks in Hamburg, which started on Monday, between the French and German governments.

French President Emmanuel Macron promised “to regain control of the price of electricity, at the French and European level” in a speech at the end of September.

As gas electricity is much more expensive than nuclear electricity, France might be tempted to switch to a national system rather than a European one to be more competitive economically.

However, France is "confident" that it will reach an agreement with Germany on electricity market reforms, Macron said on Friday.

Siding with France are other pro-nuclear countries such as Hungary, the Czech Republic and Poland, while Germany can count on the support of Austria, Luxembourg, Belgium and Italy.

But even if a last-minute agreement is reached, the two countries’ struggles over energy are creeping into all current European negotiations on the subject.

Germany wants a massive extension of electricity grids on the continent so that it can import energy; France is banking on energy sovereignty and national production.

France wants to be able to use nuclear energy to produce clean hydrogen, while Germany is reluctant, and so on.

Related News

alberta-faces-challenges-with-solar-energy

Alberta Faces Challenges with Solar Energy Expansion

ALBERTA - Alberta's push towards expanding solar energy is encountering significant financial and environmental hurdles. The province's ambitious plans to boost solar power generation have been met with both enthusiasm and skepticism as stakeholders grapple with the complexities of integrating large-scale solar projects into the existing energy framework.

The Alberta government has been actively promoting solar energy as part of its strategy to diversify the energy mix and reduce greenhouse gas emissions. Recent developments have highlighted the potential of solar power to contribute to Alberta's clean energy goals. However, the path forward is fraught with challenges related to costs, environmental…

READ MORE
thermostat

B.C. electricity demand hits an all-time high

READ MORE

power lines

Japan's power demand hit by coronavirus outbreak: industry head

READ MORE

denmark wind turbines

Europe Stores Electricity in Natural Gas Pipes

READ MORE

edmonton electric buses

Edmonton's 1st electric bus hits city streets

READ MORE