This is an unprecedented turn. While in 2022, most energy suppliers cut off their customers’ taps and increased their prices due to a historic explosion in market prices, pushing customers into the hands of EDF, the situation has changed. Since the beginning of the year, in fact, the competition is increasing: attractive offers to subscribe to electricity contracts from these alternative operators follow one another, from Ohm Energy to Mint to Octopus Energy, Total Energy or Alpic. With a clear objective: to attract as many newcomers as possible due to more advantageous conditions than traditional electricians.
” -21% on kilowatt hour price excluding tax » In relation to the regulated sales tariff (or TRV, EDF offer regulated by the state), recently proposed by the supplier Ohm Energy, although it is still under investigation by the state due to the prohibited increase in its prices in 2021. and 2022. And it’s not the only one: Mint Energy and La Belle Energy promise, for their part, a price less than 20% excluding taxes for the same TRV. Enough to make Total Energies pale, yet able to display a 17% discount excluding tax or even Alpic and Octopus Energies, which highlight the contract at -15% excluding tax compared to TRV.
Even more impressive: to counter fierce competition, the latter will also cover 50% of the Tax on Electricity Consumption (TICFE) introduced by the government from February 1. In other words, for its 200,000 residential customers, Octopus Energy itself will pay this excise of 21 euros per megawatt hour (MWh) to the state, at the risk of selling at a loss.
Significant reduction in price
A question then arises: How can these alternative suppliers, most of whom were on the verge of bankruptcy less than two years ago, make such aggressive offers now?
They are only taking advantage of the impressive drop in prices in wholesale markets, where they get their supplies because most of them don’t produce the energy they sell. Indeed, while prices flirted with around 200 to 400 euros per MWh in 2022 and 2023 (with a peak of 1,000 euros per MWh at the height of the crisis), MWh traded at just 48 euros for the day of February 9, 2024. To deliver electricity in the second quarter of 2024, you will have to pay 55 euros per MWh, on Thursday February 9, and 59 euros for the same period in 2025. That means a world very different from the world. Last two years…
But then why doesn’t EDF also take advantage of it through its TRV, to which at least 65% of French people subscribe? Finally, the historic operator, in which the state took 100% of the capital last year, produces its own electricity, thanks in particular to its nuclear fleet. And so, in theory, can offer attractive offers to customers eager to save money.
TRV represents the market price of the previous two years
Only here: this tariff, therefore regulated, is calculated every six months by an independent administrative authority called the Energy Regulatory Commission (CRE), based, among other things, on the market prices of the previous two years. In other words, the TRV that applies from February 1, 2024 (until August) partially reflects electricity spot prices in 2022 and 2023… ie the worst years of the crisis, with prices more than double what they are today. And for good reason, since the early 2000s, the state made sure to allow EDF’s competitors to compete with it, by duplicating the amount of electricity in this regulated offer that alternative suppliers had to buy from the markets to supply their own customers.
As a result, while EDF is obliged to make its offer, its rivals can tailor their offers as they see fit.
“We can now source from the market at much lower levels. We are taking advantage of this situation, which we have experienced in recent years in the opposite direction because the EDF price was unbeatable at the time,” we assume at La Belle Energy.
Price rise risk
Under these conditions, should the French on TRV be brought to the competition? In any case in the short term, their bills will be really low. However, if market prices start to rise again in the coming months, the situation could be reversed again: nothing would prevent suppliers from modifying their formulas and their price criteria, subject to informing their customers in advance – which EDF cannot do with TRV. Ohm Energy’s offering, for example, “ for an indefinite period “, so that the company has no obligation to maintain it for a certain period of time.
Due to the risk of a possible market reversal, La Belle Energy increases the fixed price of its offer “by 20% compared to the current TRV” if the user chooses a guaranteed price of more than two in 2024: 2 euros per month. year, and about 6 euros more per month in three years. ” It is a type of insurance », explains its director Gallery. It is therefore difficult to say whether the households in question will actually benefit in the long term, when EDF’s regulated tariffs should drop significantly from next year.
Arbitration at ARENH?
In addition, if prices rise again, some operators offering very aggressive offers today may increase their prices drastically and suddenly. Ohm Energy did this in 2022 as well, doubling monthly payments from September. According to numerous sources, the aim was to get rid of some part of their portfolio for resale on the exchanges at a higher price than was intended for them.
The bad: This electricity, purchased at an alternative low price, is, in part, supplied by EDF itself. Indeed, the ARENH system (regulated access to historic nuclear electricity) requires the historic operator to hand over 100 million MWh to its competitors in the name of liberalization. However, these “ARENH rights”, which guarantee access to EDF’s precious electrons at 50 euros per MWh, are calculated especially in summer, when consumption is lowest. As a result, some suppliers are tempted to attract as many customers as possible before September, in order to maximize ARENH rights…then part with them by doubling prices at the start of the school year. This was already the case in 2021 for Ohm Energy, as we wrote two years ago.
The trap may close
However, even if termination does not involve costs, consumers can sometimes be caught off guard. ” Suppliers have the right to change their offer along the way, but this must be done with full transparency and fairness, and everyone must be informed of the new terms one month in advance by law. », refers to energy mediation. However, many Ohm Energy customers were contacted Gallery claimed in September 2022 that no email, SMS or call informing them of the September 1 addition was received prior to August 16, including through their spam scanning. ” The email was sent to customer support on time », François Joubert, Director of Ohm Energy for his part, assured. Be careful, therefore, that this scenario does not happen again – even though this supplier will probably be more vigilant due to the ongoing investigation by CRE into its practices.
It remains to be seen how prices will evolve and how options will react in case of an increase. But how many households have left EDF’s TRV in recent weeks and become victims of one of these attractive offers, which the group does not disclose for the moment, even though it assures that it ” No leak found ” A definitive answer, perhaps, on the occasion of its annual results on February 23.
