Electricity price: factories in France dreaded in early 2022 comments

Some manufacturers fear production reductions or factories in France in early 2022, due to the surge in energy prices and low electricity allocation at guaranteed prices that they have received from the regulation systemArenh Wednesday.

The mechanism called Arenh (for "regulated access to historic nuclear electricity") allows since 2011 alternative suppliers and so-called “electro-intensive” industrialists to buy EDF nuclear electricity at a fixed and rather modest price, 42 euros per mWh.

This price, based on nuclear production costs in France, is very advantageous compared to electricity prices on the Spot market (cash), which has oscillated between 200 and 300 euros per MWh in recent weeks, and even byReport to the 2022 - This term market on which manufacturers are supplied when they can no longer benefit from regulated prices - which cotes 170 euros per MWh on Thursday.

Wednesday evening, big consumers of electricity, alternative and industrial suppliers, learned that they would only receive 62.37% of their cheap electricity requests in 2022, the available ceiling of the ARENH set at 100 TWh N'Having not been noted by the government.Their requests brought to 160.36 TWh for the year.

"This is the most important crew rate ever known," noted the Union of Electricity User Industries (Aiden), in which we find in particular steel, chemists or fertilizer producers, large electricity users.

"Concretely this means that electro-intensive manufacturers located in France will have to complete a significant part of their supply on the market in the coming days in the worst price conditions there is" underline in a press release.

"A certain number of sites therefore plan to adapt their production accordingly, until the complete stop for certain profiles," said the one.

Already several of them have proceeded in recent weeks to production reductions such as the Zinc Nyrstar factory in Auby (North), the electric steelworks of LME Beltrame near Valenciennes (North), the electrolysis of Kem chlorineOne in Fos-sur-Mer.Not to mention Ascoval which produces decarbon steel, passed on the verge of relocating part of its production in Germany, where steel, produced from coal, costs less than in France, while itemits a lot of CO2.

Alternative electricity suppliers had asked the State to note this year the ARENH ceiling at 150 TWh this year, but the government did not follow up "officially, because the European Commission would have opposed it», Note an industrialist.

"Faced with the severity of the situation, and for a temporary period, it is an obstacle that could have been lifted," said this industrialist.

Initially, the ARENH system had been created and accepted by the European Commission to allow alternative electricity suppliers to access nuclear electricity at low prices, and therefore to bring out competition to EDF in France.IM/ICO/Tho

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