Improving French Electricity System to Ease Oil Crisis

Categories: Economy Nuclear Power Oil Crisis

Essay, Pages 8 (1969 words)

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Summary

This short report examines the electrical power system in France, particularly in its development over the past decade.

The report looks at France's energy mix, the electricity market in the country, the role of renewable energy sources in the electrical power system, and the new ITER project as a case study for new energy production in France and around the world. The report pulls from both primary and journalistic sources to create a holistic overview of the country's strengths, weaknesses, and future in energy production.

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While certainly not exhaustive, the report discusses each relevant factor in a way that contributes to an overall understanding of this electrical power system topic.

Introduction

Ever since the Industrial Revolution, the production of energy in a country has been an important aspect of the nation's success, influence and economy. This report turns to the electrical power system in France as it relates to the country's global position. France has been a leader in global energy production since the end of World War II, and has only increased in its influence in the past decade. This short report discusses the country's energy mix, electricity market, and use of renewable energy to create an overall picture of the country's electrical power system in the modern day. In addition to these sections, the report also turns to a brief case study of the ongoing ITER project as an example of the country's investment in the future of national and global energy production. Finally, the report concludes by bringing all of these facets together for one final assessment of the electrical power system in France.

Energy Mix

The energy mix is a term that refers to how energy is consumed in a specific geographical location (such as country or region). An energy mix for a country is essentially what percentages or levels of energy are consumed from each primary energy source (RTE France, 2014). These primary sources include natural resources and fossil fuels (such as coal, oil, and natural gas), nuclear energy, and the various types of renewable energy (such as solar, wind, and biomass). An energy mix is not limited only to electricity use, but the full spectrum of primary energy uses: transportation fuel, heating and cooling, and generation of electricity (RTE France, 2014). The makeup of an energy mix by country depends on what resources are available in the country (either naturally or by import), the type of energy need to be met, and the energy policies of each country (determined by factors such as economy, politics, demographics, and environment). In this way, France has a very unique energy mix.

While the energy mix in France has changed drastically in the last century (RTE France, 2014), it has remained relatively stable for the last decade. Today, the energy mix in France is made up of 45% nuclear power, 30% oil, 15% natural gas, 8% renewable sources, and 4% coal (Fevrier, 2014). These figures have two important caveats: first, the energy mix numbers are not the same as the numbers for final energy consumption. This is due to the simple fact that a great deal of primary energy sources are used to create secondary energy (most commonly electricity). As an example, electricity constituted nearly 23% of final energy consumption in France in 2012 (Fevrier, 2014), in contrast to over 45% of consumption coming from refined petroleum products (i.e. fuel). The second caveat is that the energy mix in France is not the same thing as the power generation mix, which constitutes the sources used to create electricity. In France, this mix is made up of 73% nuclear power, nearly 14% hydropower, and less than 5% renewable energy sources. This makeup harkens back to the 1973 oil crisis, when France changed course to place most of its power generation in nuclear power plants. This energy mix is reflected in the electricity market in France, discussed in the next section.

Electricity Market

If the energy mix of a country describes the makeup of power sources, the electricity market of a country is essentially a description of the ownership of these sources. France is also an interesting example in this case, as it is halfway between privatization and nationalization. As of today, Electricte de France (EDF) is the primary provider for electricity generation and distribution in the country (Bennhold, 2005). The company is nearly a century old, founded in 1946. The company was initially a formation of many different electricity producers and distributers joined together by the nationalization of power production by a Communist-leaning government. This nationalization lasted until 2004, when EDF transformed into a limited- liability corporation subject to private law.

Despite this transformation, the French government still has nearly 85% of ownership in the EDF company as of 2007 (Bennhold, 2005). EDF also held a monopoly on power distribution until just before the turn of the century, when the European Union started to create a harmonized policy for electricity market regulation across the region. While the company no longer holds a monopoly over the country, it remains "one of the world's largest producers of electricity" (Bennhold, 2005). For instance, the company produced 22% of the entire European Union's electricity in 2003. This reflects the energy mix discussed above, as nearly three-quarters of this electricity was produced from nuclear power (Bennhold, 2005). In fact, France has the "largest share of nuclear electricity in the world" (Gore, 2009). This alone makes France an interesting study in electricity markets.

France is not only the world's eighth largest producer of electricity, but is “among the world's biggest exporters of electricity" (Gore, 2009). As noted above, the vast majority of this production and exported energy is sourced from nuclear power plants. This places the country in an interesting position, especially as the world increasingly turns to renewable sources for its energy consumption needs. Thankfully, the country may begin to see more flexibility in its production as it becomes increasingly liberalized in its energy market (Schwarts, 2012). As Schwarts states, the energy market in France "has undergone a progressive liberalization as a result of the European plan to establish a unique energy market that would end national monopolies" (2012, 86). These new strides in liberalization has led to a renewed Energy Code that addresses regulatory provisions for “electricity, gas, renewable energy, hydropower, oil and both heating and cooling networks" (Schwarts, 2012, 86). This should prove to be an important foundation for the future of the energy market in France, particularly in the way that it addresses the rise of renewable energy sources. This is highlighted in the discussion of the role of renewable energy in France, discussed below.

Role of Renewable Energy

Despite its continued reliance on nuclear power plants for the generation of electricity, France has actually proven to be a leader in the research on and use of renewable energy since its signature on the Kyoto Protocol in 2005 (RTE France, 2014). The country has invested interests in solar and wind energy production, as well as other renewable energy technologies. As Campus France reports, in France "the use of renewable energy has long been concentrated on the production of electricity through a growing number of wind engines and solar panels, and on cogeneration, a process of simultaneous production of electricity and heat from petroleum products, natural gas, waste products, coal and biomass" (2012). Therefore, it is clear that renewable energy has a substantial role to play in the production of energy and electricity in France.

While France has continued to invest in the renewable energy technologies discussed above, the country has made its mark on two types in particular: hydropower and biomass. For hydropower, the country has three large hydroelectric damns that generate a good portion of the country's domestic energy (RTE France, 2014). However, biomass has been the true focus of innovation in renewable energy in France. As Campus France reports, "biomass - the biodegradable portion of products, wastes, and residues from agriculture, forestry, industry, and household consumption - is the leading source of renewable energy consumed in France (52% of renewable consumption), ahead of hydropower, wind energy, and solar energy" (2012). In other words, the use of biomass in France is not simply an experiment in the research stage, but an integral part of the country's power production and consumption. This fact is highlighted in the case study on an energy project located in France, discussed below.

The most recent development in the role of renewable energy in the country is from this past month, July 2015, when the French government passed a “comprehensive energy and climate law" which stipulated a new mandatory renewable energy target. The new target requires 40% of electricity production in the country to be sourced from renewable energy sources by 2030 (Patel, 2015). By way of comparison, in 2014 less than 20% of the nation's electricity came from renewable energy sources. In other words, the country has a long way to go if it wants to see true integration of renewable energy in the electricity market.

Case Study: The ITER Project

There are many energy projects ongoing in France that can be used as case studies for energy production in the country, such as hydroelectric dams and solar farms. However, perhaps the best current case study is the ongoing International Thermonuclear Experimental Reactor (ITER) project. ITER is an “international nuclear fusion research and engineering megaproject, currently building the world's largest experimental tokamak nuclear fusion reactor" (Amos, 2010). While the ITER project is internationally funded and administrated, the facility is located in southern France, and therefore represents an important step forward for France's presence in the international energy policy discussion. The goal of the project is to move from experimental physics with energy to a "fully operational, electricity-production fusion power plant" (Amos, 2010). France has a vested interest in this project, as the European Union is contributing nearly half of the cost of the project.

While the first iteration of the project was way back in 1985, construction of the ITER project did not begin until 2013 (ITER 2014). The project is not expected to be completed until 2027, more than a decade after it was first slated to be completed, and now has an estimated budget of 15 billion Euros. Furthermore, the project has faced criticism from anti-nuclear groups that claim scientists are not yet able to manipulate the high-energy contents of the fusion process. Despite these delays, criticisms, and budget constraints, many officials and experts continue to view ITER as a beneficial development for the global energy market and the role of renewable energy in energy production.

Conclusion

This report has discussed the electrical power system in France as it relates to the country's energy mix, electricity market, use of renewable energy, and a specific case study of an energy-related project in the country. This analysis has provided an adequate picture of the power system in France. There are two main conclusions that stem from this report's analysis of these topics.

First of all, France's electrical power system makes France a power player. Simply put, France is a major player in the global energy market for two apparently contradictory reasons. First, France has invested heavily in nuclear power production over the past half century, which has positioned it as a major supplier and exporter of nuclear energy to the rest of the European Union. This has given the country quite a bit of clout in its energy policies. In contrast to this, France has also invested heavily in the future of renewable energies, and is ostensibly on the leading edge of introducing renewable energy as a viable alternative to fossil fuels.

The second conclusion resulting from this analysis is in regards to the future of France's power. The one challenge that remains is to overcome EDF's major hold on nuclear power in the country and European region in order to adequately address the way forward in introducing renewable energy to the electrical power system in the country. As discussed above, France has invested in renewable energies, but it remains to be seen how they can become an integral part of the country's power production.