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The threat of power cuts and shortages recedes

Published on January 18, 2023 by Pierre Belhache - 5 mins reading time
SMALL BUSINESSES Companies Electricity Gas

According to the recently updated outlook from gas and electricity network operators GRTgaz and RTE, winter should continue without power cuts or gas shortages. Although the risks are diminishing, the situation is still subject to unforeseen events, such as the arrival of a possible cold snap, which would lead to a significant increase in energy consumption.

Electricity consumption down and nuclear fleet availability up

On January 18, electricity network operator RTE published an updated outlook for the winter of 2022-2023, following an initial study carried out in September. According to RTE, the situation has improved considerably since early autumn.

Electricity consumption was 8.5% lower than the average for the period 2014-2019. All sectors of activity contributed to this fall in electricity consumption, which " is neither solely nor mainly explained by a drop in economic activity in industry ".

Individuals and businesses alike have responded favorably to the call for energy sobriety, even if " it remains difficult to distinguish in this movement the respective shares of chosen sobriety and economic constraint ".

The situation has also improved in terms of generation, thanks to greater availability of the nuclear fleet, with almost 45 GW, or three quarters of maximum power. As forecast by RTE in September, the availability of the fleet will continue to improve slightly until the end of the month, before declining in February due to the maintenance shutdown of 9 reactors.

The improvement in the situation has led to a significant drop in prices, confirming RTE's view that "the prices charged for France in the summer and autumn of 2022 were not consistent with the fundamentals of the system and reflected an exaggerated anticipation of the risk of default by market players, even when projecting on a deteriorated situation ".

 

 

However, the grid operator insists on the need to continue efforts in favor of energy sobriety. In addition, even though nuclear output is higher, it remains below historical levels, which means that maintenance and work on reactors cannot be delayed.

 

 

Gas stocks at record levels

GRTgaz's outlook is also positive, as confirmed by theupdated gas outlook for winter 2022-2023. Gas stocks reached a record level, at 80% on January 15, compared with an average of 55% on the same date over the last 6 years. The risk of a gas shortage for the rest of the winter therefore seems " highly unlikely ", according to GRTgaz.

The risk of a daily deficit has also " virtually disappeared ", although there is still a "residual risk over a few days " if the country is hit by both a reduction in supplies and a major cold snap.

Gas consumption has fallen by 12.8% between August 1, 2022 and January 15, 2023, since the announcement of the national energy sobriety plan. GRTgaz has noted both a drop in consumption by industrial customers connected to the transmission system (-24%) and customers connected to the distribution system (-13%). At the same time, gas-fired power plants consumed more (+23.3%) to compensate for the lower availability of nuclear power.

Imports of liquefied natural gas (LNG) have risen considerably: between November 1 and January 15, 2023, 87.7 TWh of LNG were delivered to LNG terminals in France, representing an increase of 41% on the previous record for the same date. LNG imports accounted for 75% of French consumption between November and January.