The French Electricity Company suffered huge losses in 2022
In 2022, the French Electricity Group suffered one of the worst losses incurred by a company listed on the Paris Stock Exchange CAC 40 index, which led to a rise in its indebtedness to a record level as well, amounting to 64.5 billion Euros (about $69 billion) at the end of the year.
The company was affected by problems in its nuclear fleet and its forced participation in the government’s measures to reduce the expenses of the French.
Sales of the electricity giant, Electricity de France, increased by 70% to 143.5 billion Euros ($153.4 billion), driven by higher energy prices.
However, the group declined with a very heavy net loss amounting to 17.9 billion Euro (about 19 billion dollars), compared to profits amounting to 5.1 billion Euros ($5.45 billion) in 2021.
This is one of the largest losses recorded by a group in France.
With the sharp rise in electricity prices, Édpe de France witnessed the return of a large number of French customers, but it was unable to produce enough power plants and had to buy electricity at high prices in the markets.
The group’s chairman, Luc Raymond, who took office last fall with enormous challenges facing the company, told reporters that the significant increase in sales is driven by electricity and gas prices.
However, he added, the gross operating margin was significantly affected by a decline in nuclear production and the exceptional regulatory measures implemented in France in 2022 in difficult market conditions.
Raymond stressed that the production of nuclear plants ranges in the range of 300 and 330 terawatts per hour during 2023, noting that this indicates a gradual exit from the stress corrosion crisis, that is, the problem of micro cracks that were detected on parts of the pipes, which led to the closure of a number of pipes. of reactors since the end of 2021.
The year 2022 witnessed a decline in the nuclear and hydraulic production of electricity to historic levels in the midst of a global energy and climate crisis.
The government will allow us to finance investments and meet the group’s financing needs, the group’s chief financial officer, Xavier Geyer said.
However, when these results were announced, the government immediately put pressure on the group.
It said it was “relying on the new CEO and all employees to get all electricity production back on track as quickly as possible”.
“The reform of the group’s finances will mainly take place through an increase in production volumes,” Economy Minister Bruno Le Maire and Energy Transition Minister Agnès Pannier-Ronacher said.
Electricity de France faced many problems from detecting corrosion and delays in maintaining power stations due to the Covid-19 epidemic.
The result was a decline in the operational capacity of the 56 nuclear reactors in 2022 to 54%, compared to 73% during the period 2015-2019, which threatened power outages in the middle of winter.
But in the end, the worst was avoided thanks to electricity imports, the efforts of the French in the electricity economy, and the efforts of the Electricité de France to restart its reactors.
However, this doesn’t mean that the group’s production hasn’t declined, as it hasn’t previously reached this level of decline since 1988: 279 TWh in 2022.
This is very far from the group’s production in 2005, when it reached 430 TWh.
The situation was exacerbated by the war in Ukraine, which contributed to the rise in gas and electricity prices.
In order to contain these additional expenses incurred by the French, the state, the largest and almost the only shareholder, forced the group to sell more electricity in 2022 at lower prices to its competitors, alternative electricity suppliers.
The cost of this was exorbitant to the Electricité de France and amounted to 8.34 billion Euros ($8.92 billion).