On 28 June 2018, the CRE adopted a decision regarding the TURPE 5 HTA-BT (medium voltage – low voltage) tariff and the change from 1 August 2018 to that tariff, known as the “second TURPE 5 HTA-BT”. This decision included an adjustment of an average -0.21% to the TURPE 5 from 1 August 2018, following a combination of factors:
This decision had no impact on the tariff preparation method, the operating expense trajectory, the principle of regulation for incentive purposes, or the regulations applicable to Linky meters. The change in the corporate income tax rate is equivalent to adjusting the return on regulated equity to 4% and the margin on assets to 2.5% (previously 4.1% and 2.6% respectively).
The decision also reiterated previous CRE decisions about expenses relating to customer management under a single contract (decision of 26 October 2017), via the management component, and collective auto consumption (decision of 7 June 2018), via the energy withdrawal component. It was published in the Journal officiel on 29 July 2018.
In particular, to implement the Council of State’s decision of 9 March 2018, the CRE added back an annual amount of around €1.6 billion (and will add back declining amounts until 2073) to regulated equity. The CRE considers that this will lead to Enedis receiving additional remuneration equivalent to €750 million (in 2018 euros) expressed in the present value of pre-tax cash flows. This add-back to regulated equity results in remuneration of some €60 million per year in the first few years, on a basis that will reduce progressively until 2073 at a (nominal pre-tax) rate that may, under the present method, be revised by the CRE at each tariff period.
On 25 June 2019 the CRE adopted a decision concerning revision of the TURPE 5 tariff for the medium and low voltage network at 1 August 2019. The tariff scale increased by an average +3.04% from 1 August 2019, comprising +1.61% for inflation, +1.45% to balance the CRCP, and -0.02% in application of the Council of State’s decision of 9 March 2018.
After Law 2017-1839 of 30 December 2017 confirmed the CRE’s competence for supplier commissioning, the CRE issued a new decision on 18 January 2018, published in the Journal officiel of 25 January 2018. This decision reiterated the principles adopted in its previous decision of 26 October 2017 regarding remuneration payable by distribution network operators to suppliers for the service of managing single-contract customers on their behalf.
The content of these decisions upheld the principle of identical commissions for all suppliers selling single-contract market-price offers. Only regulated electricity tariffs were to give rise to slightly lower commissions (€4.50 instead of €6.80 per point of delivery until 1 August 2019), with progressive reduction of this difference to zero by 1 August 2022.
For remuneration of past customer management charges (prior to 1 January 2018), the CRE’s decision set an amount it considered as a cap that can be passed on through the TURPE tariff.
However, Law 2017-1839 of 30 December 2017 introduced a measure intended to rule out the possibility of suppliers receiving remuneration from network managers for past customer management services.
On 23 December 2016, Engie brought an action against Enedis before the Paris Commercial Court claiming such remuneration. In the course of this litigation, Engie filed an application for a preliminary ruling on constitutionality (question prioritaire de constitutionnalité) concerning the arrangements introduced by the French “Hydrocarbons” law which ended the possibility of obtaining supplier commissioning for past services. These arrangements were validated by the Constitutional Council in its decision 2019-776 of 19 April 2019. The proceedings are still ongoing.
On 22 March 2018, the CRE published its consultation on the levels of contribution due to the Electricity Equalisation Fund for EDF SEI and Électricité de Mayotte for the years 2018 to 2021. The annual average contribution to the Electricity Equalisation Fund for EDF SEI, including the planned smart metering system, is €185 million for the period 2018-2021.
The draft amended decisions for the period 2012-2017 and the proposed decisions for the years 2018 and 2019 were published in the Journal officiel on 21 June 2019 and 19 October 2019. Their implications are as follows:
The compensation mechanism for public energy service charges (compensation des charges de service public de l’énergie) results from a reform introduced by France’s amended finance law for 2015, published in the Journal officiel on 30 December 2015. Under the legislative and regulatory framework, the public energy service charges (electricity and gas) were to be compensated via two State budget items included in France’s finance laws from 2016 onwards. The initial finance law for 2020 marks a continuation from 2019, defining the following measures for compensation of charges for 2020:
Since 1 January 2018, the “basic necessity” rates for electricity and the “special solidarity” rates for gas have been replaced by an energy voucher system. The cost of this system is not borne by EDF, but has been budgeted by the State in the “Public Energy Service” programme. However, EDF bore solidarity charges in 2019 and will bear such charges in 2020 for the national housing solidarity fund and services for vulnerable customers.
