From September 18, EDF will experiment with the auction on the markets of electricity volumes deliverable in 2027 and 2028, illustrating the group’s desire to provide competitive energy and ensure better visibility of its revenues. For this experiment, it will offer a volume of 100 megawatts (MW) of electricity which can be sold in the form of auctions at a rate of 1 to 5 MW per day, until exhaustion.
The target offering: alternative suppliers and traders in the wholesale electricity market. Through this system, the 100% state-owned group wants to offer offers “on longer maturities”, which would be synonymous with “more stable prices”, summarized Karine Revcolevschi, director of upstream optimization Aval Trading, during a press presentation.
Today, players and suppliers can buy electricity on the markets to cover the needs of their customers over three years – therefore until 2026 – but not beyond, argues EDF. These offers will allow market players “to have medium-term products that are currently poorly available”, at a fixed price, indicated Marc Benayoun, executive director in charge of the Customers, Services and Territories division.
“Opening prices for the periods 2027 and 2028 is in the interest of customers” because they are currently quoted less expensive than for the years 2025 and 2026, he said. The year 2022, marked by an unprecedented escalation in energy prices, “revealed that today our customers have high expectations regarding price visibility and stability.”
These solutions also offer “a model that is financially sustainable by the EDF group,” added Marc Benayoun. With this experiment, EDF is preparing the end of Arenh, the regulated mechanism which requires it to sell part of its electricity to its alternative supplier competitors until January 1, 2025. A system accused of leading to “under-remuneration” of the company, according to the words of its CEO, Luc Rémont. However, EDF is at the foot of an investment wall: it will have to find 25 billion euros per year to finance old and new nuclear and renewable infrastructures.
EDF has been pleading for several months for long-term electricity sales contracts, a framework which would allow it to set the prices of its nuclear production more freely, while limiting the exposure of end customers to volatility, according to the group.
“It’s a way for the consumer, all consumers, the very big and the small, to see their price land and no longer be victims of volatility dictated by exogenous phenomena. For the producers, it is obviously the way to have a form of visibility on their income which triggers the investment “, pleaded Luc Rémont in June at the congress of the French Electricity Union (UFE).
