French Market Analysis
Analysis of the French energy market is key to understanding the dynamics and trends affecting the sector both locally and internationally. In this detailed analysis, we address the important factors influencing energy prices, supply and demand, and the latest regulatory policies. This comprehensive overview will allow you to keep up to date with weekly changes and anticipate possible market variations, both in France and in other relevant markets such as Spain.
Table of Contents
December 2024
Evolution of demand and production mix
In December 2024, electricity consumption in France during peaks in demand averaged 67.3 GW. The peak electricity demand in December was reached on Friday, December 13, at 75.6 GW, in line with the levels seen the previous month (72.4 GW).
Renewable energy sources contributed 33.7% of the total energy produced. Specifically, hydro energy accounted for 15.4% of the total energy produced, while wind energy accounted for 11.3% and photovoltaics contributed 7%. It is worth noting that hydroelectric stocks grew significantly this summer, and the tendency has been maintained over the months, reaching the highest level of storages observed in the past 4 years mid-October at 3 178GWh. At the end of December, the levels decreased to 2 548GWh, below last year’s level (2761 GWh).
Average electricity prices for day-ahead base contracts in France had an increasing tendency over the last month from 101.32€/MWh in November to 110.48€/MWh in December. Prices fluctuated considerably throughout the month, with the minimum day-ahead base contract price at 32.25€/MWh on December 20th, and the maximum price at 176.69€/MWh on December 13. During the Christmas season, the French government issues energy-saving messages, and many industries are shut down. There is a drop in demand, which has the effect of lowering prices at the end of the year.
With 89 TWh of net electricity exports in 2024, France has beaten its all-time record of 77 TWh set in 2002. This year, France recorded a positive export balance on all its borders: Germany-Belgium (27.2 TWh), Italy (22.3 TWh), United Kingdom (20.1 TWh), Switzerland (16.7 TWh), Spain (2.8 TWh), etc. “In 2024, this new record for net electricity exports is the result of the major recovery in French nuclear generation, the continued development of renewable generation (wind and solar) and the abundance of hydroelectric generation” according to RTE’s publication on 02/01/2025.
The year 2024, likely to be the hottest on record, saw an intensification of extreme weather events driven by climate change, resulting in thousands of deaths, mass displacements, and severe impacts on ecosystems and economies, according to the World Meteorological Organization. Urgent actions are needed to cut emissions and steer the world toward a safer path, emphasizing that every fraction of a degree of warming worsens climate risks.
Gas
In terms of gas prices, the TTF spot contract closed at €48.2€/MWh on the 30th of December. Since the beginning of October, the trend has been upwards, month by month, until the beginning of December (48.1€/MWh 02/12/2024), when prices began to fluctuate in a yo-yo pattern: 39.65€/MWh in mid-December, before reaching the levels seen at the beginning of December at the end of the month (48.2€/MWh).
In terms of gas generation, the average during maxima followed November’s level (5 GW versus 4.6 GW in December). December was a month of contrasts, alternating between mild and cool, and even cold.
At the beginning of December, France’s gas storage levels were at 79.71% and at the end of the month at 60.51%, well below 2022 and 2023 years.
President-elect Donald Trump stated on December 20, 2024, that the European Union must significantly increase its imports of American oil and gas or face tariffs on certain EU exports.
Fuels
Brent month-ahead oil contract prices slightly increased from 73.28 $/bbl on November 28th to 74.17 $/bbl on December 28th. From July 1, when the price was $86.60/bbl, to the end of December, this represents an almost 20% decline. The geopolitical situation in the Middle East continues to play a key role in the up-and-down price trend.
Future contracts trends
The French electricity contract Cal26 average maximum price in December (65.87€/MWh) is lower than November’s levels (67.08€/MWh). At the end of December, the EPR nuclear reactor at Flamanville was finally connected to the electricity transmission grid. If this reactor operates as expected, it could supply a significant amount of decarbonized electricity, contributing to the stabilization of French energy prices.
The US, the world’s second largest greenhouse gas emitter should witness a new boom in American oil and gas production, which Trump openly supports. That would be good news for US competitiveness, but sad news for the Environment – both domestically as the increased production would mean more shale oil and gas production, and thus fracking, and globally, as Trump will most likely take the US again out of the Paris Agreement, as he did during his previous presidential term (2016-2020). But above all, a policy of maximizing American oil and gas production should reduce energy prices in the United States in the short term, and further increase the gap with the much higher prices in Europe, at the expense in particular of the European economy and industry.
In December, the TTF Cal25 contract averaged at maximum 43.56 €/MWh an increase compared to November (42.939 €/MWh). TTF Cal 26 followed a stable trend and stayed below Cal25 levels all-throughout December and closed at 38 €/MWh on December 30th.
EUA Jan’25 prices, increased from 68.71 €/t on November 29th to 71.14 €/t on December 31st.
