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When it is necessary to increase the regulated tariffs of the electricity to allow the alternative suppliers to make more profits to remunerate their shareholders !!!

15/02/19 Publications, Europe

We are left with a real paradox! The European Commission and alternative electricity suppliers, who have always praised "free and undistorted" competition on the grounds that it would lower prices, now need an increase in regulated tariffs (set by the public authorities). Indeed, the increase in kWh tariff on the market is no longer profitable and cut their profits.
Competition at the production level does not exist in reality. No supplier has built new means of production to compete with historical producers. All threw themselves into the lucrative market of highly subsidized renewable energies whose bill estimated by the Court of Auditors amounted to 121 billion directly taken from the consumer bill. These private companies only re-sell electricity they buy either to EDF up to 100 TWh maximum at a rate below the production costs (ARENH) set up by the NOME law or on a wholesale market which, until then, was below the price of ARENH.
Today, the lack of investment in production facilities in Europe or France leads to a rise in the price of the wholesale market, to more than 56 € / MWh. Alternative suppliers who previously bought most of their electricity in this market, because it is cheaper than ARENH (42 € / MWh) are trapped.
CRE received a total demand of 132.98 TWh for the year 2019 from 69 electricity suppliers (excluding EDF subsidiaries), whereas the legislative ceiling set 100 TWh / year the amount of electricity allocated to suppliers at a price of € 42 per MWh. Not everyone will be served! The balance will have to be on the market.
So to allow alternative suppliers to maintain their profiles and to continue nibbling customers, only one solution: increase the price of regulated tariffs of users.
Once again, it is the demonstration that competition does not lower prices, on the contrary and that its logic is contrary to a development of public utilities.
Now, the Government has the choice either to respond to the profits of private companies or to maintain the purchasing power of users.
If necessary, this situation demonstrates the aberration of Brussels to want to transfer to the private our hydraulic power stations, pledge of safety of the electrical system and management of rivers.

An increase of 5.9% will have serious consequences
for users

The consequences are likely to be dramatic for families. According to INSEE (in 2015) 15% of the French population is already in energy poverty, 22% of the population could find it. Energy poverty in Franche affects more than 12 million people, and more than 5.6 million affected households (ONPE).
The ONPE (National Observatory of Energy Insecurity), rightly, recalls that a 10% increase in the price of energy would switch 423 235 additional households in a situation of fuel poverty.
In 2018, following families' difficulties in paying their electricity bills, the number of power cuts (228,472) was higher than the power cuts (211,797). This is also a consequence of the liberalization of the electricity market.
Access to electricity meets a vital need, its pricing can not depend on the market or dividend objectives of shareholders. Access to energy must be recognized as a vital right and be enshrined in the French constitution as such.
To fight against exclusion and poverty, it is imperative to have basic tariffs (a vital need) and social tariffs (to respond to poverty).
Also, law must prohibit supply cuts to vulnerable consumers regardless of the time of year.

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