After the year 2022 was marked by unexpected events, the price of which was very high, the EDF group was able to turn the corner by achieving an excellent year 2023. If profits reach a record, the impact on factors should not be seen this year.
For his first year at the head of the French group, Luc Raymont achieved a whopping figure of 10 billion euros in net profit in 2023. Meanwhile, electricity prices have risen in France. Announced by Bruno Le Maire on January 21, the hike in electricity bills came into effect on February 1. The increase, from 8.6% to 9.8%, has a significant impact on French people’s electricity bills.
Given the good results achieved by EDF, one might think that a reevaluation of the price of the “regular tariff” that concerns about 21 million households in France could be considered. Apart from that, to establish its price scale, EDF submits a formula to calculate TRV (regular sales tariff) which depends 50% on supply cost.
The latter concerns specifically the cost of nuclear generation as well as prices observed on the electricity market. Clearly, the reduction in electricity bill prices is not based on the profits made by the French group, but on long-term market trends.
In 2022, the EDF group was forced to import electricity at higher prices, particularly due to a sharp drop in its nuclear output due to the deterioration of its reactors. In 2023, the group managed to turn the tide, benefiting in particular from rising electricity futures prices. ” The impact of the price increase is 12.1 billion euros for end consumers and 12.5 billion euros covered by the tariff shield. It is particularly explained by the average forward market price for 2023 for the two previous years of €71/MWh in 2022 versus €218/MWh.», explains EDF. In fact, electricity bills have increased by more than 35% in a year.
Towards a reduction in electricity bills in 2025?
As a result, it will be necessary to reach the next update of TRV (scheduled for February 2025) to hope to see any change. Indeed, the bills paid by French households today are the result of price increases registered by the market in previous years.
” Taking the average price over two years, the price peaked in October 2023 and has been declining ever since. On February 1, 2025, the very high prices observed on the markets in 2022 will disappear from the calculation formula. Hence EDF’s supply cost should drop sharply on this date », estimated by Julian Tede, founder of broker Opera Energy and reported by capital city.
