(Bloomberg) -- The chief executives of TotalEnergies SE and Electricite de France SA sparred over how France should handle its power-market rules while the country deals with its current political impasse.
TotalEnergies CEO Patrick Pouyanne said the government should consider extending an existing measure that makes EDF sell about a quarter of its annual nuclear output to rivals at a steep discount to current wholesale prices until the end of 2025.
France had planned to introduce a new regulation from 2026 to take part of EDF’s revenue when power prices rise above certain thresholds and redistribute the proceeds to users. The proposal, aimed at keeping a lid on prices, was part of the 2025 budget bill now hanging in limbo after a coalition of left-wing and far-right parties ousted the government last week.
Extending the existing rule, while fixing its faults, could “provide some clarity for two or three years, to reassure everyone” in the absence of new regulations, Pouyanne said at an electricity conference in Paris on Tuesday. “This lack of clarity doesn’t provide trust” to clients.
“If Patrick prefers a regulated system, I will stop my investments, and there will be less electricity eventually,” Luc Remont, CEO of state-owned EDF, retorted with a smile as the two men sat together on a panel.
As part of the new regulatory framework, EDF has been selling power to other suppliers such as TotalEnergies for periods of as long as five years, which has allowed for a sound and competitive market, Remont said.
While current power prices are relatively low, the redistribution mechanism in the 2025 draft budget proposed before the government’s ousting will have to be reintroduced in a finance bill as soon as possible to mitigate any large rebound in future electricity costs, Emmanuelle Wargon, the head of France’s energy regulator, said in a subsequent speech at the conference.
The CEOs of EDF and TotalEnergies agreed that a law aimed at accelerating the deployment of renewables in France has made the process more time-consuming. TotalEnergies will probably reach half of the 10 gigawatts of renewable capacity that it’s targeting in France by 2030, Pouyanne said, adding that it’s twice as quick to get permits and build clean-power projects in Germany.
“It’s hell to invest in France because of regulations, not only for renewables and nuclear, but it’s also hell to connect manufacturers and data centers” to the grid, Remont said. “Red tape is the first brake to decarbonization.”
(Updates with comments from the energy regulator and CEOs from seventh paragraph.)
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