France Demands Energy-Market Shake-Up as Europe Resists

(Bloomberg) -- French Finance Minister Bruno Le Maire arrived in Brussels for a meeting with his peers on Monday demanding they take seriously his country’s proposal to revamp energy markets in the European Union. 

The minister will present a so-called non-paper outlining proposals to bring visibility to energy prices and avoid surging gas and electricity costs that “jeopardize the social and economic sustainability of the energy transition.” 

“We want to protect consumers against this rise in energy costs, which for many households is unbearable,” Le Maire told reporters as he arrived at a meeting of euro area finance ministers. 

European leaders have already brushed off calls for a fundamental overhaul of the system, opting to stick with the tax cuts and subsidies many states have already introduced. But France believes governments should decouple the cost of electricity bills from rising fossil fuel prices -- when electricity is mainly produced with nuclear plants and renewables. It counts Spain and Greece among its allies on the subject. 

France’s first proposal is for an “automatic stabilizer” mechanism to transfer the gains of high energy prices from producers to suppliers and customers. The country also backs a European Commission idea for long term contracts to guarantee costs of low-carbon energies for businesses, and is calling for assurances for households on the solidity of suppliers, Le Maire said. 

The non-paper says there is a need for better coordination of national gas storage regulations and a push toward energy independence in the EU by boosting investment in efficiency and carbon-free production. 

Le Maire said there was some misunderstanding about what France wants: The government is not pushing for any change to the wholesale market and the proposals are focused on structural issues rather than short term difficulties. A finance ministry official speaking ahead of the meeting said the responses in the non-paper are not necessarily for the next three to six months.

“We are used to being in a minority that eventually wins thanks to the strength of our beliefs, and by explaining things,” Le Maire said. 

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