Millions of French Households Brace Themselves for a Staggering 11.7% Hike in Gas Prices Commencing July 2024
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IN SHORT |
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🔥 11.7% increase in gas prices on July 1, 2024 |
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💸 Impact on household budgets |
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📈 Price increasing to 129.2 euros including tax per MWh in July |
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⚡️ Annual bill increasing for residential customers |
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⚒️ Revaluation of gas transport rates |
On July 1, 2024, millions of French households will have to face an 11.7% increase in the price of gas. What will be the consequences on your budget? Stay informed to understand the impact of this increase on your daily life.
On July 1, 2024, French households will be faced with a 11.7% increase in gas prices. This increase comes after a period of relative price stability, mainly due to the revaluation of distribution network prices. Although gas costs are significantly lower than their peak in summer 2022, many households will see their energy bills increase significantly.
The average reference price of gas will be 129.2 euros including tax per megawatt hour (MWh) in July 2024, compared to 115.7 euros in June. In terms of current consumption, this corresponds to a reference price of around 13 cents per kilowatt hour (KWh). This increase will directly impact the annual bills of French households.
According to the Energy Regulatory Commission (CRE), the annual invoice including tax of a residential customer with an offer indexed to the “benchmark price” would reach 1,184 euros at the July rate, compared to 1,060 euros in June, and 1,227 euros in January. This increase can be attributed mainly to the increase in gas transport prices by the network manager GRDF.
The revaluation of the gas transport tariff decided in February 2024 largely explains this increase. This revaluation is spread over a period of four years and includes in particular the costs associated with maintenance and the progressive integration of biogas. Suppliers like EDF, Engie and TotalEnergies have told their customers that they will pass this increase on to their bills.
The French government has started to lift the price shield put in place in 2021 to protect consumers from price increases. This decision not only leads to an increase in the price of gas, but also that of electricity. Preparing measures to reduce gas consumption, comparing offers from different suppliers and anticipating these price increases is crucial for consumers, in order to effectively manage their energy budget.
Context of the increase in gas prices
On July 1, 2024, French households will be faced with a 11.7% increase in gas prices. This increase comes after a period of relative price stability, mainly due to the revaluation of distribution network prices. Although gas costs are significantly lower than their peak in summer 2022, many households will see their energy bills increase significantly.
Evolution of gas prices
The average reference price of gas will be 129.2 euros including tax per megawatt hour (MWh) in July 2024, compared to 115.7 euros in June. In terms of current consumption, this corresponds to a reference price of around 13 cents per kilowatt hour (KWh). This increase is relative compared to the start of 2024, where the average price was 133.9 euros including tax per MWh. This increase will directly impact the annual bills of French households.
Household bills
According to the Energy Regulatory Commission (CRE), the annual invoice including tax of a residential customer with an offer indexed to the “benchmark price” would reach 1,184 euros at the July rate, compared to 1,060 euros in June, and 1,227 euros in January. This increase can be attributed mainly to the increase in gas transport prices by the network manager GRDF.
Reasons for the increase
The revaluation of the gas transport tariff decided in February 2024 largely explains this increase. This revaluation is spread over a period of four years and includes in particular the costs associated with maintenance and the progressive integration of biogas. As gas consumption has decreased by 20% between 2021 and 2023, network maintenance costs, however, remain high.
Impact on suppliers and customers
Suppliers like EDF, Engie and TotalEnergies have told their customers that they will pass this increase on to their bills. As most gas supply offers are indexed to the benchmark price published monthly by the CRE, the majority of consumers will see their bill increase.
Exit from the tariff shield
The French government has started to lift the price shield put in place in 2021 to protect consumers from price increases. This decision not only leads to an increase in the price of gas, but also that of electricity, which had already increased by 9% in February 2024. This choice aims to reduce public spending linked to energy subsidies.
Recommended preparations for consumers
- Adopt ecological behaviors to reduce gas consumption.
- Compare offers from different suppliers to find more advantageous rates.
- Check if your contract allows you to switch to a fixed price offer to avoid future increases.
Understanding and anticipating these price increases is crucial for consumers, in order to effectively manage their energy budget. Preventive actions and judicious choices can help limit the impact of these increases on French households.
