France’s government announced plans on Wednesday to nationalize Electricite de France S.A. (EDF), a French state-owned multinational electric utility company, to help EDF better manage a worsening energy crisis currently plaguing both France and greater Europe, Bloomberg reported.
French Prime Minister Elisabeth Borne made the revelation during a policy speech in France’s parliament in Paris on July 6.
“Borne didn’t provide specific details of the government’s plans, beyond saying the state will raise its stake in EDF to 100% from 84% currently,” Bloomberg relayed.
“No decision has been made at this stage on the modalities of the operation,” a spokesman for France’s finance ministry told reporters of the nationalization of EDF, which is Europe’s largest producer of nuclear power.
Bloomberg explained some of the circumstances that prompted France’s federal government to pursue a full takeover of EDF this week, writing:
France will acquire the 16% stake [in EDF] not already owned and nationalize the company. This suggests state intervention may increasingly feature elsewhere in the EU [European Union], given the worsening energy crisis, to ensure market continuity, mitigate cost inflation and drive the region’s energy-security plans.
EDF has been grappling in recent years with various issues at its aging fleet of reactors and cost overruns when building new ones. Its problems are being exacerbated by a government-imposed cap on electricity prices and Russia’s invasion of Ukraine, which is making it more expensive for the company to cover its own electricity-output shortfall.