Chilliness in the French electricity market – déjà vu?

After the frights experienced last winter due to the limitations imposed by the French Nuclear Safety Authority (ASN) on the operation of EDF’s nuclear power stations (see our Newsletter N°5 from April 2017), the price of electricity led a quiet life. Throughout the year, these prices rose, driven upwards by the price of coal. Shocking as this may be for a country where coal-based electricity production represents a mere 1.4%, the price of electricity in France is highly correlated with the price of coal (with Germany placing the orders). Like we said, everything was going well right up until the ASN made the alarms go off once again this past August – déjà vu?

On 16 August, the ASN submitted for consultation its draft decision concerning the review of components manufactured by the Creusot Forge Areva NP plant and installed on nuclear reactors in operation. The draft decision required that EDF examine all manufacturing files for these components. Following a closure for refuelling, EDF will have to send the results of this review to the ASN – two months before restarting each of the affected reactors. The ASN has given EDF until the end of 2018 to complete this review in its entirety. Even if these inspections should only entail ‘paperwork’ and thus have a limited impact on maintenance operations, the reaction in the electricity markets was remarkable (+€3/MWh for Winter 2017-2018).

Some days later, on 24 August, the ASN stated that EDF had reported new anomalies in the manufacturing files of the components at Creusot Forge. According to EDF, nine files were sent to the ASN, all while specifying that ‘the analysis of these discrepancies shows that nothing is likely to call into question the safe operability of the equipment concerned’. Despite these reassuring statements, a state of apprehension settled in the markets, as illustrated by Baseload Cal 2018 price curve (Baseload Cal 2018 cleared at €40/MWh).

A few weeks later came a new announcement from the Nuclear Safety Authority which, on Wednesday 13 September, revealed that it had placed the power station at Belleville-sur-Loire (Cher) ‘under increased monitoring’. Grounds given: ‘the observed deterioration in the level of safety since 2016’. Thus, the power station will be subject to additional inspections made by ASN engineers and technicians, but without going so far as to call for a shutdown. Even if the event is not very significant, there has been an immediate response in the markets: rising electricity prices for Winter 2017-2018.

Finally – and you can bet that this isn’t the last in the series – the ASN ordered the immediate shutdown of Tricastin (4x900MW) on 28 September on the grounds of a risk of flooding in the event of the Donzère-Mondragon canal’s breakdown. Panic took control of the market.

If, in addition to the events concerning the shortcomings in nuclear quality assurance, the return of the reactors to full operation (following scheduled maintenance) is delayed, markets fear the worst. For several months, maintenance schedules have been extended, and the power stations require an additional 2-3 weeks for restarting if compared to the initial calendar. As winter begins, with hydraulic reserves in sharp decline, such a delay may suggest a loss of between 5 and 7 GW of available power. In the event of a cold spell, the impact on electricity prices would be particularly significant. To cover themselves against these risks, market players will, over time, purchase electricity for the months ahead, resulting in an increase in prices.

In light of these events, we offer two conclusions to our readers. The first is addressed to consumers: There is an obvious risk of market tension; the recommendation here is to cover this risk by means of hedging contracts, avoiding short positions.

The second conclusion is one for the long term, aimed rather at planners and legislators. The French electricity system is becoming increasingly fragile. Given the system´s nature, which heavily relies on an ageing nuclear fleet, operational or regulatory inadequacy incidents will inevitably occur more frequently. If, at the same time, the system backup is reduced by decommissioning of thermal power stations due to obsolescence, pollution, or simply for economic reasons, the situation will likely worsen.

Therefore, our second recommendation is addressed to the French energy authorities. The best way to ensure system reliability is to allow reserve production resources to be available in order to meet peak demand. To make this work, it would be necessary to ensure the minimum revenues and / or reduce the costs of this peak production:

  • On the revenue side, the French state was a forerunner in transitioning from an ‘energy only’ market model to an ‘energy plus capacity’ market model – despite the reluctance of Brussels. Now, the issue is ensuring that the capacity market works and that it sends the necessary signals in order to retain power at peak times. For the time being, we should focus our attention on the relatively insignificant role that demand is playing in capacity auctions.
  • On the costs side, there is still work to be done. The gas connection rates and taxes borne by such facilities are no longer adequate for their precarious situation. A facility that should only be in operation for a few hundred hours per year to cope with the hazards of the System should not be taxed as a base production facility. IFER, property tax, etc., are failing to take this reality into account. In addition, gas connection costs are a function of capacity, not of usage. Furthermore, bringing the legislative and regulatory framework on gas storage up to date could, if poorly administered, deal a fatal blow to many peak producers. It would be a pity if the authorities only became concerned about the fate of these producers once they’ve already disappeared. (See related article)

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Each month, one of our experts publishes an article describing his view on a specific topic of the constant changes taking place in the energy market, with special focus on the French market.

Profesional Experience & Education

Diego graduated in Political Economy at King’s College University (London – 2021). He started his professional career in a family business in Madrid as an operations manager. Diego then studied a Master in Management and Master in Computer Science at IE University (Madrid – 2022), during which he participated as an Information Technology (IT) intern in a startup. In May 2023, Diego joined the HES team as an intern specialised in programming models. In his first project, he developed a software tool for modelling the unavailability of the French nuclear fleet. Afterwards, Diego has also participated in the development of new software tools for modelling price curves, generation asset performance and other topics related to the energy market. 

Diego Marroquin

Junior Consultant

Diego Marroquín

Profesional Experience

Céline joined Haya Energy Solutions in November 2021 as marketing and administration manager. She had a first professional experience in the tourism sector as a social media manager. At HES, her activities are focused on the development of the company’s visibility at European level through: commercial actions, content marketing and development of brand strategy. Céline is also involved in the management of the company’s communication: optimisation of the website (WordPress & Elementor), LinkedIn, publication of the monthly newsletter and the organisation of conferences. Céline participates in energy projects with the clients and acts as coordinator and project manager. Finally, she is in charge of administration (accounting, expenses management, invoicing).   


Céline graduated in Spanish and English Philology at La Sorbonne (France – 2018) and holds a Master’s degree in Project Management and Cultural Tourism (Clermont-Ferrand/ Buenos Aires – 2021). 

Céline Haya Sauvage

Marketing Responsible

Céline Sauvage

Investment Advice

“Decarbonization of the Energy and Transport sectors is arguably today’s main economic driver for the industry.”

Profesional Experience

His career started in civil engineering as a Project Manager in France, Martinique and Australia. Afterwards, he became the General Manager of a subsidiary in Venezuela. In 1992, he established Dalkia in Germany (district heating, cogeneration, and partnerships) and represented Véolia in Thailand. In 2000, he opened the commercial office of Endesa in France to take advantage of the liberalized retail market. From 2006, as a development Manager at Endesa France, he led Endesa’s plan for Combined Cycle generation in France and developed the wind and PV portfolio of Snet at the same time. Philippe Boulanger worked for 3 years at E.ON’s headquarters coordinating the company´s activities in France. He was strongly involved in the French hydro concession renewal project. As a Senior Vice President – Project Director at Solvay Energy Services from April 2012 to February 2014 he was in charge of the H2/Power to gas and European direct market access deployment projects. Philippe has been an HES expert since 2014.


Philippe Boulanger holds engineering degrees both from the Ecole Polytechnique and the Ecole Nationale des Ponts & Chaussées (France) and has a combined experience of more than 25 years in energy and infrastructure. In addition to English, Mr. Boulanger is fluent in French, German & Spanish.

Philippe Boulanger

Electricity Expert


“The world is changing. New investors pay particular attention to the energy sector while historical actors adapt their position to the market.”

Profesional Experience

Antonio started his career in the electricity sector in 1991 working as a member of the General Manager’s team at Sevillana de Electricidad (Spain). In 1997, he was appointed head of commercial regulation at Endesa Distribución. In 2000, he joined the mergers and acquisitions (M&A) department of Endesa Europe. He was appointed Managing Director of Endesa Power Trading Ltd (UK) in 2003. A year later, he became responsible for energy management at SNET (France). In 2008, he was appointed Managing Director of SNET (France). In 2009, he became Director of Corporate Development at E.ON France. In 2011, he founded Haya Energy Solutions (HES), a consulting firm focused on optimising the energy management of consumers, producers and retailers of gas and electricity. From 2015 to 2018, Antonio combined the consulting activity at HES with the general management of 2 production facilities in France (2 CCGTs x 410MW), owned by KKR. At the end of 2018, he joined Asterion Industrial Partners, an infrastructure investment fund, as an operating partner. Antonio currently devotes most of his efforts to the Asterion Portfolio, while advising through HES companies in the energy sector in France, Italy, Germany, UK and Spain. 


Antonio graduated from the Escuela Técnica Superior de Ingenieros of Seville (Spain) and holds an MBA degree from Deusto University (Spain). 

Antonio Haya