As I’ve noted before I live in France. This winter my electricity will be significantly lower in cost (still high of course) than if I lived in the UK. I had thought this was simply the difference between a state run electricity supply and the UK’s open market. And it sort of is but it is not quite as simple as that.
I discovered that UK electricity bills are set against at whatever price is needed to bring the most expensive producer into the grid. The most expensive, not the cheapest or the average.
And definitely not reflecting the contribution from low-cost renewables. Consumer tariffs are thus the highest they could possibly be, reflecting the rising spot market price of gas as this is highest cost electricity production this year.
If you think about it, consumers in the UK are bailing out gas-based electricity producers and dishing out massive profits to the other producers. In France, the gas-based producers (who were private btw) looked like they would go bust as the price they were getting was based on the average production prices. So the French government simply bought them out and nationalised them into the state electricity company. (Who funnily enough is EDF which owns one of the biggest electricity suppliers in the UK.)
This looks like the UK has a market based energy supply and this is not working. There seems to be no risk for high cost producers and little incentive for them to find lower costs. The consumers are always going to burdened with price spikes and will always have to carry the costs. And in France the nationalised energy supply does protect the consumers. Something to think about when you next hear ‘small state’ being promoted.
Hi
You are spot on with that one.
It is not what we were promised by our Politicians who are now quite happy for the ordinary person to increase the profits of foreign suppliers.
@swimfeeders , Its what they call capitalism Swimmy !!
Make as much profit as you can !!
You can blame Magie Thatcher for that !!
I saw this on Twitter, does anyone know if it’s true?
“ When the Tories sold off our electricity in 1991, 5 of the ‘Big 6’ ended up in the hands of the French, German, Spanish and Swiss. Now these companies charge British consumers up to 4 times European prices in order to subsidise electric back home.”
@Maree , Exactly that !! Thatcher has a lot to answer for ??
Only thing she got right was the Falklands IMO ?? 
So what happened was that France capped domestic energy price rises at 4% but here in the UK our lot capped it at 54%!
So EDF here was able to raise their prices here by up to 54% but in France by only 4%
So in effect, our higher prices here are subsidising EDF having to comply with the 4% cap in France
Why can’t our lot cap it at 4%?
She certainly has a lot to answer for, despicable contemptible woman
And what she did in the Falklands made her a war criminal 
Quite right … they ( meaning the Argentines), invaded
Hi
Back to the OP.
The UK is the only major economy wgich has gone full open market on everything.
Even the USA, that bastion of free markets has strategic reserves.
Here we are, now likely to get another total free Marketeer in charge.
We can only blame ourselves.
Yes, but to a relatively small extent, the EDF ownership of a UK energy business is taking money out of the UK and into the French state energy company. But, more importantly, it demonstrates the fallacy that state owned companies are bad at running businesses. That is a right wing lie and proven to be rubbish every time you see a badly run private company.
As for capping the UK energy price increases just re-read my opening post. In the UK there is a bizarre version of free market economics. It has been designed so that there is no state oversight or control as the aim was small state / free market. Again, we see this myth that private companies and the market knows best. So the UK energy market knows that you deserve a massive price hike on your bills. Enjoy.
Hi
A large number of our infrastructure structure companies, not just energy are owned by French, German and other Foreign State Enterprises and they are well run and make loads of money at our expense.
You are quite correct in this lack of supervision here.
There was a ludicrous situation some years ago with a Council which was doing a huge refurbishment program of new double glazed UPVC windows, we are talking tens of thousands here.
They could not get the spec they wanted at the right price so set up their own manufacturing company, very successful, then expanded to supply other huge councils and then the private sector.
They where making £21 million a year profit, which went to subsidise the rates.
The Government then insisted they sell the business as they did not want the public sector running businesses.
They where the biggest, but loads of other instances.
What, in the way the government knew who to sell the UK’s satellite business to? This one was brushed under the carpet a bit. The UK government invested £500m in our OneWeb company during the Covid period. This company was well placed to take a significant slice of satellite internet business. But rather than continue to support it the government has just let it be bought by the French Eutelsat company. Another classic mistake by our goverment.
Hi
It applied to all sorts of things.
Many many years ago, a callow youth on his first promotion, I was tasked with cutting the costs of pest control and sewer cleaning.
It was not a massive amount of money, but quite significant all those years ago.
I had to cut the costs to the rate payers by £30k a year.
I was told just do it, how you do it is your problem.
I did, by taking over the Pest Control Contracts for the Port, fixed prices for wasps nests, mice, drain cleaning.
A simple Northern Lad, it was not difficult, took on more staff and vehicles and whilst I did not cut costs by £30k a year, I did make a profit of £71k a year in the first year.
The Tories where not happy, but tough.