France considers lower electricity tax to stabilise household power prices

France considers lower electricity tax to stabilise household power prices

PARIS: The French government is considering lowering taxes on electricity in order to stabilise household power bills, two sources familiar with the situation told Reuters on Thursday.

The government had said this week that it would prevent state-controlled utility EDF’s regulated power prices from rising this winter, but the firm’s competitors immediately said they would challenge that decision in court. Earlier government attempts at freezing prices have been overruled.

Household power prices are set by independent energy regulator CRE in a complex formula that includes the price of power generation, transport and distribution. A third part of the retail price is made up of taxes.

“What is being discussed is that the share of taxes in the power price could be reduced in order to compensate for an increase in the generation cost, which on balance would keep prices stable,” said one of the two sources.

Meanwhile, Paris police and store owners are bracing themselves for new violence at protests Saturday, despite President Emmanuel Macron’s surrender over a fuel tax hike that unleashed weeks of unrest.
Police, unions, and local authorities are holding emergency meetings Thursday to strategize — while disparate groups of protesters are sharing plans on social networks and chat groups.
After the worst rioting in Paris in decades last weekend, many shops and restaurants in the center of the capital are expected to shut down Saturday, fearing a repeat of the violence.
Macron on Wednesday agreed to abandon the fuel tax hike, but protesters’ demands have now expanded to other issues.
Protesting students are disrupting schools and universities Thursday, and drivers are still blocking roads around France, now demanding broader tax cuts and government aid.

(With Reuters, AP)

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