🚨 Electricity - The government announces a tariff shield for SMEs

On Sunday 23 October 2022, Agnès Pannier-Runacher, Minister for Energy Transition announced the upcoming establishment of a” electricity guarantee” for businesses that” will make it possible to take (bear) part of the bill that businesses have to pay.”

“This electricity guarantee will make it possible to take on part of the bill that businesses must pay today, at a time when electricity prices are soaring, we will not let manufacturers close, we will not let businesses down.”

Who will benefit from this measure?

All SME business categories excluded from the tariff shield will be eligible for this measure.

💡 As a reminder, only VSEs, which have a turnover of less than 2 million euros and have less than 10 employees, are already protected by the tariff shield.

The French government also intends to negotiate with the European Commission to try to benefit intermediate-sized companies (ETI).

What party will be affected by this measure?

“The so-called ARENH part, which allows access to an invoice of around 50 euros per MWh, is already protected and out of the remaining 50%, we are going to take part of the cost between a reference price and the reality of the prices that companies pay”.

Concretely, the State could finance up to 50% of the portion of the bill subject to market prices (red and orange parts) if the market price is greater than €325/MWh ➜ The State will pay 50% of the part that exceeds €325/MWh.

In other words, this new mechanism would make it possible to generate A saving of 10 to 25% on business electricity bills in 2023. ” The discount could be between 15 and 70 euros per MWh per consumer ”, details a government source.

Currently still under consideration, this mechanism should be amended in the draft finance law that is about to be adopted.

What is the cost to the state?

7 billion euros will be mobilized by the State to apply this measure; it is to the ready euro what the contribution for superprofits will bring. Combined with the 3 billion already released by the State, as part of the fund to help businesses in difficulty due to energy prices, this would bring the amount of support to businesses to 10 billion euros.

Will these envelopes be enough to cushion the shock of soaring energy prices? This will depend on the evolution of the markets. If this were not the case, the government would have one last card to play: the increase in electricity quotas sold at discounted prices via ARENH.

Learn more about clipping ARENH: What is clipping?