Economy, Energy and the Budget may object to the CRE’s proposals and by joint decision set a lower level accounting for 95% of the tariff applied for customers’ consumption, in order to serve the objective of price stability.
In such an event, the law defines a mechanism to compensate EDF and the local distribution companies for the loss of income on their regulated-tariff offerings, and to compensate all suppliers for the loss of income on market-price offerings for residential and non-residential customers eligible for regulated sales tariffs, via the compensation for public service charges (CSPE). EDF therefore recognised a receivable of €1,571 million in 2022 (see notes 5.5.1 and 13.5.4).
In a decision of 19 January 2023, the CRE proposed an increase of 99.36% including taxes (108.91% excluding taxes) in the “blue” tariffs for residential customers and 97.94% including taxes (106.88% excluding taxes) in the “blue” tariffs for non-residential customers from 1 February 2023. This proposed increase was primarily justified by:
In line with the tariff cap, this proposal was rejected by the Ministers for the Economy and Energy, who set the increase in the “blue” tariffs for residential and non-residential customers at 15% including taxes (20% and 19.9% respectively excluding taxes) through tariff orders of 30 January 2023, published in the Journal officiel of 31 January 2023 and implemented from 1 February 2023.
The costs borne by the network operators Enedis and RTE for management of the public electricity distribution and transmission networks are covered, provided they are in line with the costs of an efficient network operator, by the “TURPE” tariffs for using the networks, as stipulated in Articles L. 341-2 and following of the French Energy Code.
These tariffs apply to users connected to the distribution and transmission networks.
The CRE issued two decisions of 21 January 2021 (published in France’s Journal officiel 0096 of 23 April 2021) on the TURPE 6 Transmission (high voltage) and TURPE 6 Distribution (medium voltage – low voltage), after the Higher Energy Council (Conseil supérieur de l’énergie) gave its approval. These tariffs apply from 1 August 2021 for a period of approximately 4 years.
For distribution expenses, in its tariff decision n°2021-13 of 21 January 2021, the CRE set the margin on assets at 2.5% and the additional return on regulated equity at 2.3%. The average tariff increase was +0.91% at 1 August 2021. In decision n°2022-158 of 9 June 2022, the CRE set the increase in the average TURPE Distribution tariff from 1 August 2022 at +2.26%.
For transmission expenses, in its tariff decision n°2021-12 of 21 January 2021, the CRE set a nominal pre-tax weighted average cost of capital (WACC) of 4.6% for the return on RTE’s regulated asset base. The average tariff increase was +1.09% at 1 August 2021. In decision n°2022-157 of 9 June 2022, the CRE set the change in the average TURPE Transmission tariff from 1 August 2022 at -0.01%.
In its decision 2022-317 of 1 December 2022, the CRE adapted the price regulation framework to make the TURPE 6 (high voltage) and TURPE 6 (medium voltage – low voltage) tariffs incorporate the impact of wholesale electricity prices on the business of RTE and Enedis, particularly by refocusing certain incentives on purchase volumes and losses, rather than on prices.
In another decision, 2022-323 of 8 December 2022, the CRE decided to put in place an exceptional advance payment of part of the balance of RTE’s income and expense adjustment account (CRCP). In a context of significant growth and volatility in wholesale electricity prices at European level, this surplus paid into the CRCP for 2022 essentially results from particularly high interconnection income. This payment will have a direct effect for users connected to the public transmission network operated by RTE, who will receive a one-off payment from RTE by 15 March 2023. Enedis, as the principal user of RTE’s network, will be a beneficiary of this advance payment. The Group has therefore recognised a sales credit receivable from RTE amounting to €1,723 million (see note 13.3.4).
In application of the CRE’s decision of 18 January 2018, energy suppliers receive remuneration from distribution network operators for the service of managing single- contract customers on their behalf.
The commissioning principle is identical for all suppliers selling single-contract market-price offers. Only regulated electricity tariffs have given 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 in a challenge to the arrangements introduced by the French “Hydrocarbons” law ending 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 before the Paris Commercial Court ended on 11 April 2022, the Court having formally declared the action extinguished as the time limit was exceeded.
The TURPE tariff for the medium and low-voltage network is identical for every electricity network operator. It is determined on the basis of forecast expenses to be borne by Enedis, provided they correspond to an efficient network operator, and forecasts of the number of consumers connected to Enedis’ networks, their consumption, and the power level subscribed.
As this tariff cannot always cover the specific needs of certain service zones, the Electricity Equalisation Fund (FPE) exists to compensate for disparities in network operating conditions. The Energy Code requires electricity distribution costs resulting from public network operation to be shared between public distribution network operators. There are two equalisation mechanisms: one based on fixed amounts, the other set by the CRE based on analysis of the network operators’ accounts. The calculation method for the fixed-rate allocation mechanism is defined by decree and ministerial order. The EDF entities concerned by the Electricity Equalisation Fund are Enedis, Électricité de Strasbourg and SEI.
