Bloomberg News

French Power, Gas Prices Will Rise to Help Fund Investment

June 08, 2012

French power and natural-gas prices will increase to help fund investment by the industry, Ecology, Sustainable Development and Energy Minister Nicole Bricq said.

“Prices will rise because there is enormous investment that has to be made,” Bricq said on Public Senat television, declining to say whether gains will be from July 1. “I won’t confirm because I haven’t looked at the files or decided.”

Electricite de France SA and GDF Suez (GSZ) SA’s household rates are set by the state. GDF Suez last year won a 4.4 percent gain from Jan. 1 after challenging a government decision to freeze gas prices in the country’s highest court. Changes to power prices are typically introduced during France’s summer months.

“I know there is a strong trend for costs of energy to increase,” Bricq said today. “Even if we make new fossil fuel finds, they will be expensive and in electricity there is huge investment to be made to ensure grid quality.”

At least half a million households had power or natural gas supply cut off or reduced last year because they couldn’t pay their bills, the energy ombudsman said in March. A spokesman for Paris-based GDF Suez declined to comment today on gas prices.

France has to find a way to make energy more affordable for people on low incomes, Bricq said. “We have to find calculation methods that would penalize less those who use less,” she said.

To contact the reporter on this story: Tara Patel in Paris at tpatel2@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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