On July 2007 started the last step of the opening up of the energy market in France, i.e., of the electricity and gas markets. This process started in 1996 when the European Union decided to open up its market and liberalize it, in order to create one single market without monopoly. It was a big step for France, especially because the energy market was nationalized at the end of the Second World War. So, for sixty years the market was supplied by only two companies that held almost the whole market and which were working together. The main difference consists in allowing the 12 million particular consumers to change their energy supplier. Before that, the industrial market in energy supply was deregulated in 2003. However, this deregulation will be controlled by the State in order to protect the consumers and to avoid abuses. After the World War II, many modifications were made in order to change the infrastructures that remained before the war. One of them, and not the least, was the nationalization of the energy market because it was considered for long as a monopoly and inevitably related to the state. That is why the production and the distribution of electricity and gas were nationalized, in France, by the law of the April 8th 1946. This led to two major changes.
[...] And, in a period of sharp rise in energy prices, their bills are considered reasonable whilst the switch to the private system is synonymous with a significant increase in prices. If we turn to the suppliers of electricity: the new companies conquered of the electricity market. This figure should continue to grow but EDF remains the main supplier of electricity. Indeed, thanks to its nuclear capacity, EDF produces very cheap electricity, at a cost far lower than the free market prices. [...]
[...] The regulated price rates are fixed by the public authorities, more exactly by the Minister in charge of Economy and Energy, according to the recommendation of the French energy regulator “Commission de Régulation de l'Energie”. Market prices are freely fixed by the suppliers and determined by a contract. They can fluctuate much more quickly than the regulated price rates. The various situations that the consumer can encounter since the opening of the energy market are the following: 1. The consumer does not change his accommodation : - if he has a contract with EDF or GDF, he can automatically continue to benefit from the regulated price rate ; - If he has chosen to switch to a private energy supplier, he can negotiate a new contract in the free price system. [...]
[...] The table[1] below shows the rates of the main electricity suppliers: Company Subscription Standard price Evolution of (price range of the MWh* tariff conditions before tax for (before tax, current going current going KVA) KVA) regulated national blue price rate ; Revaluation of the tariff conditions every year ; As from July supplier guarantees a maximum price rate lower than the regulated price rate until July Revaluation of the tariff conditions every year ; month conditions every ; month The contract is indexed on the evolution of the regulated price rates ; The supplier guarantees that the offers which are lower than the regulated price rates at the time of subscription, remain so at every annual renewal ; year and in case of modification of the cost-in-use of networks fixed by authorities. * 1 MWh = 1000 kWh In conclusion, we can draw conclusions of the behavior adopted by customers since the opening of the energy market in July, 2007: these have remained faithful to the historical operators. Among the 39 million subscribers to EDF and GDF, they were thus less than to have switched to private operators. [...]
[...] Goals of liberalization of the energy market The goals of the liberalization are numerous: o It must replace the regulated monopoly and ensure a market competitive background. o Competition should decrease the price of energy by optimizing the costs and revenues of the producers and should increase the number of traders and the variety of the services and products supplied o It should develop an internal market for electricity and natural gas o It should remove trade barriers and allow cross-border energy competition The consumer should have the possibility to choose the most suitable supplier and product with respect to the character and quantity of consumed electricity. [...]
[...] One of them, and not the least, was the nationalization of the energy market because it was considered for long as a monopoly and inevitably related to the state. That is why the production and the distribution of electricity and gas were nationalized, in France, by the law of the April 8th 1946. This led to two major changes. EDF (Electricité de France) was founded as a result of the nationalization of a number of electricity producers, transporters and distributors by the Communist Minister of Industrial Production Marcel Paul. [...]
APA Style reference
For your bibliographyOnline reading
with our online readerContent validated
by our reading committee
