The renewal of the 2024 budget in 2025 canceled the increase in taxes on electricity, which will push prices down.
A breather for French households, while waiting for a new budget. The regulated electricity price should fall by 14% on February 1, for individuals, according to a decree published on Saturday by the government.
The price shield will end, but the increase in the electricity tax (excise) planned in the 2025 draft budget will not take place. The regulated price will therefore be able to pass on the drop in international prices to the bills of the French.
In detail, the decree stipulates that the tax will mechanically rise on February 1 to its pre-crisis level, adjusted for inflation, i.e. 33.70 euros per megawatt hour for individuals compared to 22 currently.
9% initially planned
The initial budget proposal presented by Michel Barnier planned to increase this tax to obtain 3.4 billion euros in order to fill the public deficit, which would have had the effect of limiting the reduction in household bills to 9%.
This flagship measure of the finance bill had been forcefully contested in Parliament by both the RN and LFI and LR voices, fearing for users' bills. In a final concession to avoid the fall of his government, Michel Barnier renounced this increase on November 28, without however avoiding censorship a few days later.
The decree published on Saturday “concerns the end of the tariff shield which had been put in place following the sharp increases linked to tensions on the electricity market in 2022 and 2023”, it was explained in the entourage of Minister of Industry Marc Ferracci.
“The tax increases provided for in the initial finance bill do not come into force” and “the drop in electricity prices should be, as announced by the Prime Minister on November 28, 14%. in 2025,” we added.
Electricity prices have fallen sharply on the markets and the 22.4 million households and businesses with regulated sales tariff (TRV) contracts, or 56% of subscribers, will therefore benefit despite the end of the tariff shield.
