According to a release by the French finance ministry on Thursday, the French government has finished nationalizing the nation’s largest energy utility, EDF, and the company has now been officially removed from the Paris stock exchange.
The takeover comes after a disastrous year which saw nuclear output fall to a 34-year low and the company suffering a record loss.
The nationalization of the utility was welcomed by Finance Minister Bruno Le Maire, who referred to the takeover as a “success” and noted the takeover was “indispensable” for the energy company’s future.
Paris launched a buyout of the 16% stake in the utility starting in late 2022, offering €10 billion ($10.9 billion) in a bid to take full control of the debt-stricken energy provider. The French government already held almost 84% of the utility, with about 15% of the electricity provider in private hands and the remaining 1% in the hands of the utility’s employees.
Roughly 70% of France’s electricity is generated from a fleet of nuclear reactors, all of which are operated by EDF. Last year, however most of the reactors were either shut down or undergoing maintenance due to recurring corrosion issues, which led to a shard drop in electrical power generation.
The reduced nuclear power generation drove dramatic increases in the cost of electricity in France last year. That forced EDF to purchase energy on the wholesale markets to cover the shortfall in production, and that further exacerbated the cost of living crisis in France, as well as the energy crisis in the rest of Europe.
As it was forced to purchase electricity during the energy crisis, EDF’s debt rocketed 50% to nearly $70 billion last year, causing it to post a record loss.
Production this year is expected by the company to be in the range of 300 to 330 terawatt-hours, which will rise to 345 terawatt hours in 2024. That is still some ways from the 380 terawatt hours which was produced in 2019.
Analysts say that despite its long history as an energy exporter, it is expected that France will have to rely heavily on electricity imports from its neighbors, including Germany, in order to meet its domestic power demands next winter.
