Committed to a European agreement aimed at reducing the EU’s gas needs by 15%, France is organizing a battle plan with a view to achieving this objective. In particular, it asks manufacturers to propose solutions to reduce their consumption. At the risk of suffering gas cuts in the event of a shortage this winter.
28% of the gas consumed by energy-intensive industries
For months, the term “energy sobriety” is hammered daily. Impossible to escape energy saving at a time when the whole European Union fears a gas shortage from next winter.
Manufacturers should play a decisive role in this forward-looking policy. Currently, 28% of gas is consumed by energy-intensive industries in France. The Ministry of Economy, Finance and Recovery has made it clear to all manufacturers that thetarget of 15% reduction in gas consumption between August 2022 and March 2023 concerned them in priority.
Several sectors are therefore called upon, as of now, to take this urgency into account. On July 10 during the 22thEconomic meetings of Aix-en-Provence, several business leaders assured that they were ready to participate in the national effort in order to avoid the breaking point. France gets 17% of its gas supplies from Russia. If the country decides to completely cut off its exports to the European Union, this shortfall cannot be compensated.
“I think that the total disruption of the gas supply from Russia is a real possibility (..) and we must be prepared for this option”
Recalled Bruno Le Maire, the Minister of Economy, Finance and Recovery during this meeting with business leaders. The message is clear.
These industries threatened by load shedding
The most energy-intensive industries are therefore called upon to make an effort now. Otherwise, they might suffer significant load shedding in the event of a proven gas shortage during the winter of 2022.
France’s gas stocks are currently 79.35% full, according to the latest data from the Aggregated Gas Storage Inventory (AGSI) established on August 1, 2022. The objective is to reach the 100% capacity by November to meet winter demand. Energy saving is therefore an emergency that industries cannot circumvent.
The government and the main players in this type of industry are already considering a list of non-priority sectors. These designated industries might be affected by the shedding operations in order to meet the gas needs of the so-called “essential” ones. Industries related to health, food or even national defense might be prioritized, explained Nicolas de Warren, president of the Union of Energy User Industries (Uniden) during an intervention on the BFM Business channel. .
Other companies, which might withstand the shock in the event of a gas supply disruption, would be affected by cuts. Industries that have the necessary inventories to end the year might very well suffer from shedding. But also, cement plants that have the option of using stocks of solid recovered fuel (SRF). These are large pellets obtained from non-hazardous waste. The production of metals and glass might, for their part, be considered less urgent.
But there once more, if these industries can survive a load shedding, they would pay heavy consequences in the long term. European glassmakers have expressed fears that their production and supply chains will be compromised by a gas shortage. Cement manufacturers are doing their best to accumulate CSRs, but the loss of gas will impact their productivity no matter what.
The 5,000 French companies identified by the decree of April 8, 2022 and whose consumption exceeds five gigawatt hours per year were questioned to find out what impact a load shedding operation would have on their production. The questionnaire sent by the prefectures will make it possible to know whether this option is possible and for how long.
French industries are turning to other energy sources
While many players in energy-intensive industries have committed to participating in the European effort, they are trying at the same time to find alternatives so as not to slow down their production too much.
This is the case of Michelin, a tire producer. Florent Menegaux, president of the French group, explained from Aix-en-Provence to Archyde.com that their european production units had chosen to convert their boilers to run on both gas and oil. Like the tire giant, other manufacturers have thought of this process, so as not to depend on gas and turn to oil in an emergency.
Electricity is also an alternative, but very limited. Since it must be remembered that part of the electricity used in France is produced from gas. Electricity is also a problem. EDF is encountering major difficulties with its nuclear fleet. At present 27 out of 56 reactors are shut down. The nuclear power generation is therefore at a very low level.
The French government is trying rescue plans, in particular by lifting certain constraints on the production ofrenewable energies. Agnès Pannier-Runacher, Minister of Energetic transition announced on July 28 several emergency measures to boost the production of renewable energies. Electricity produced by wind farms is now one of France’s priorities.