French Winter Power Twice as Pricey as Germany’s on Nuclear Woes

(Bloomberg) -- France’s weakened nuclear power output means the cost of its electricity for next winter is more than twice as expensive as Germany’s, as concerns over the health of the country’s reactors persist.

The “massive” gap of nearly €250 ($273) per megawatt-hour between French and German prices is because traders are pricing in more risk as they await updates on Electricite de France SA’s struggles with its aging atomic fleet, according to analysts at Engie SA’s EnergyScan. “No participants want to risk being short next winter,” they wrote.

French power for the first quarter of 2024 is trading at €416 per megawatt-hour, more than double Germany’s rate of €169. Normally a power exporter, France’s atomic generation has been gradually returning to service but still remains below historical averages.   

The price discrepancy is a sign of France’s lingering energy woes even as its European neighbors benefit from a prolonged drop in prices. EDF’s nuclear reactors have faced recurring corrosion issues as the government takes greater hold over the state-backed utility.

France, which relies on nuclear energy for most of its electricity, is expected to remain heavily dependent on power imports during the winter months to meet its demand. Meanwhile, Germany closed its last nuclear plants Saturday after years of political tension over phasing out the technology, but is still very reliant on polluting coal-fired power.

French nuclear availability was at 62% on Wednesday, according to data compiled by Bloomberg. Nuclear output on Wednesday was above its level for this time last year after weeks of historic lows.

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