POWER bills are set to soar in the next months with increases in both electricity and gas prices.
Gas bills will rise 4.8 and 5.2 per cent from April and this will see the average bill increase by €45 a year, a 20 per cent rise in a year.
A five per cent rise in electricity prices from July is the first of a series of increases that will see costs surge 30 per cent over the next four years.
Electricity bills will rise five per cent every year until 2015 until they reach €39 per megawatt/hour under a report on the reorganisation of the pricing structure, due to be published at the end of March.
The European Commission had demanded a new price tariff to get rid of uncompetitive pricing in France – where power prices are about one-third less than elsewhere in the community; the average French power bill is around €625 a year, as against a European average of €930.
News of the rise comes days after power firm Eléctricité de France (EDF) revealed a 74 per cent profit slump as demand was still below pre-recession levels. In 2010 EDF made €1.02 billion, down from €3.90bn.
EDF has been ordered by the Commission to sell more of its production to private operators GDF Suez, Poweo and Direct Energie.
The private firms want access to EDF’s cheap nuclear power at prices between €31 and €36/MWh but EDF president Henri Proglio said any price less than €42-€45/MWh would be “plunder” as it is spending €35 billion over the next 20 years on maintaining its nuclear power stations.
Energy watchdog Commission de Régulation de l'Energie (CRE) had called for a tariff of between €34 and €37, while the Groupe des Fédérations Industrielles (GFI), representing heavy industry, said that it wanted the price set at €30.
GFI added that if EDF got its way with a €42/MWh price then 30,000 jobs would be in danger as companies’ power bills would soar €4 billion over the next four years.
Early indications are that the report, by former telecoms watchdog Paul Champsaur, had settled on the €39 figure. It will be published at the end of March. If he settles on the EDF’s preferred €42MWh price then costs to consumers will rise 35 per cent over the next five years.
The French government holds more than 80 per cent of EDF's capital.