Plus or minus 15%, calendar… all you need to know about the drop in the price of electricity which affects millions of households

Electricity bills should drop from February 1st for millions of French people. (ILLUSTRATION) MAXPPP – THIERRY TONNEAUX

The electricity bill of most French households, or more than 24 million households, will drop by 15% on February 1st, a first since 2015. A consequence of the end of the tariff shield and the absence of a tax increase, as announced in a decree on December 28, 2024.

The electricity bill will drop by 15% on average for more than 24 million households starting Saturday, but the discount will not be the same for everyone while increases will apply to 10 million subscribers, enough to rekindle the price battle between suppliers to remain “competitive”.

The drop from when ?

The bill will drop by 15% for 20.4 million subscribers to the “Blue tariff” EDF to which are added the 4 million subscribers to the market offer indexed to this regulated sales tariff (TRV).

The historical supplier EDF indicates to the AFP that it will apply the reduction on the monthly payments of all its monthly payment customers “from the month of March and at the latest in the summer”.

On the overall bill, the price of electricity per kilowatt hour will drop from 28 to 24 cents. This is an average because the size of the discount depends on the type of offer. In the “Base” tariff, the reduction will be 14.5%.

Subscribers during off-peak/peak hours will benefit from a reduction of 16%, representing an annual saving of 651 euros for a 4-person household using cooking-heating-hot water.

On the other hand, it is limited to 2% for subscribers using the Tempo option (which offers reduced rates in exchange for reduced consumption on certain days), an offer that is already 30% lower than the “base” tariff.

“A catch-up”

It results from the method of calculating the TRV, which contains three components: the cost of the energy itself, taxes and transport.

It is the first component, thanks to the sharp drop in electricity prices on the markets, which makes it possible to cushion two large increases planned for February 1: an increase of around 50% in the government tax on electricity (excise), marking the end of the tariff shield put in place during the energy crisis, and a 12.9% increase in the transport and distribution share of electricity (Turpe).

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The “energy share” is calculated over the last two years, which excludes from the calculation the annus horribilis of 2022 marked by the surge in prices in the wake of the war in Ukraine and the corrosion crisis in French nuclear power plants.

“This reduction is essentially a catch-up. The TRVs only reflect the reality of market prices … with a one to two year delay”, underlines the supplier Octopus Energy.

And for the 10 million households in market offers ?

The revaluations of the excise duty and the “Turpe” will weigh on the 10 million individuals in market offers.

The increase in the excise duty concerns all customers, in regulated tariff or not, and that of the “Turpe” will be applied “for the vast majority of contracts” in market offers, according to the National Energy Mediator, an independent public authority.

These customers who have already benefited for over a year from the drop in wholesale prices with offers up to 30% lower than the TRV, should thus see their advantage reduced.

But as “suppliers always tend to align themselves with the TRV”, a compass for the market, the Energy Mediator expects to see suppliers “review their offers” to remain competitive. In other words, the drop in TRVs reshuffles the cards in this highly competitive market.

“As always, we tell customers to compare offers”, recommended Emmanuelle Wargon, the president of the Energy Regulatory Commission (CRE).

What room for maneuver ?

“Some contracts will go a little above the TRVs, not all, it depends on what the companies will do”, which remain free to pass everything on or not, she explained on the 16th January.

In accordance with its conditions of sale, TotalEnergies will apply the increase in the Turpe to its fixed-price contracts subscribed after February 1.

“We will stick with offers that are more competitive than the regulated tariffs”, Franck Schmiedt, General Manager of Electricity & Gas, assured AFP.

Engie will continue to offer in February “a promotion of 100 euros which brings” its 1-year fixed-price market offer “below the regulated tariff”. The comparator of the Energy mediator to be updated in the coming days.