State energy group EDF and the French government have agreed on €70 per megawatt hour as a reference level for future prices of nuclear power, a source close to the government said on Monday.
EDF’s current price regulation model is set to expire at the end of 2025, which has led to months of tense negotiations between the energy group and the government.
Whilst the state is looking to keep electricity bills down for households and businesses, EDF hopes to maximise revenue in order to boost investment.
At one point in the negotiation process, the stand-off even threw doubts over the fate of Luc Rémont, CEO of EDF.
Appointed to the post just over a year ago by French President Emmanuel Macron, some feared that Remont would resign over the state’s demands.
The government wanted the new reference price for electricity to be close to EDF's nuclear production costs.
The French Commission that regulates energy recently estimated nuclear production costs to be €60 per MWh, well below EDF's estimate of around €70.
Speaking of the deal earlier today, French economy minister Bruno Le Maire said: “We wanted to strike a balance between affordable prices, competitive prices, and prices that would give EDF the financial room to invest in the future, and that’s what the outcome will be."
He continued: “We are regaining sovereignty over our prices, because we are providing long-term transparency on electricity costs, so that you, the consumers, whether individuals or businesses, are not exposed to another electricity crisis.”