FREE

France Electricity: A Terrible Time To Underproduce

France's untimely underproduction of electricity stems from challenges to the nuclear power sector. Delays to the maintenance of nuclear reactors, due to the pandemic and labour shortages, forced much of the nuclear fleet to shut down precisely when the availability of electricity has been made worse by Russia's invasion of Ukraine. While French households and businesses in recent months have reduced their electricity consumption, authorities do not rule out the possibility of power rationing this winter – an outcome that would weigh on the country's already weak macroeconomic prospects.

-- France's energy conservation effort appears to be working, as the country's consumption of electricity has declined in recent months relative to the past.
-- Those conservation efforts may prove inadequate due to the untimely underproduction of electricity, stemming principally from complications in the nuclear power sector.
-- The electricity crisis in France weighs on the country's already weak macroeconomic prospects.

“Recent success at electricity conservation and repair to nuclear reactors means the risk of power cuts in France this winter is diminishing, but the risk has not gone away,” said Jason Graffam, Vice President of the Sovereign Group at DBRS Morningstar. “Whether or not France is forced to ration electricity in the coming months will depend on the continued cooperation of the French public, acceleration of repairs to nuclear reactors, the availability of imports, and mild winter weather.”