ClientEarth joins court case which could transform French electricity market

Media release

22 June 2020

ClientEarth has joined a court case which could break commercial strongholds in the French energy market, clearing the way for an energy system based on renewable energy and citizen participation.

Set to be heard at France’s highest administrative court on Monday 22 June, the case, brought by a former Lyon Councillor, argues that France’s flagship energy legislation breaches EU law. It aims to remove legal barriers preventing the deployment of renewable energy and to allow people to create, consume and distribute their own electricity.

To do this, lawyers are challenging a contract that allows energy company Enedis to dominate the electricity distribution market in the city of Lyon.

Raphael Soffer, lawyer at environmental law organisation ClientEarth, said: “Recent EU laws aim to transform our energy systems by boosting renewables and putting citizens at the centre of the transition to sustainable, renewable energy: this is the future, but current legal restrictions in France hinder this and that’s why we’re taking action.

“If France is serious about its climate ambitions, it needs to start promoting renewable energy on the ground – which means making sure that individuals and communities can fully participate at all levels of the energy system. The French system must change.”

France’s legislative framework allows Electricité de France (EDF) and its subsidiaries Enedis and RTE to exclusively operate most of the country’s transmission and distribution systems.

This framework clashes with recent European laws that aim to boost renewable energy adoption. The “Clean Energy Package” grants rights for European citizens, businesses and local authorities to set up their own energy projects, enabling them to carry out energy activities like consuming, storing and selling the energy they produce and operating parts of the energy system.
The new laws also require countries to assess any legal and administrative obstacles that prevent their development and to start dismantling them.

ClientEarth’s lawyers argue that the current French Energy Code is incompatible with EU law as it grants exclusive and unlimited rights to EDF subsidiary Enedis to operate the distribution network in metropolitan France.

Despite ambitious declarations, France is set to miss its 2020 renewable energy targets. Our lawyers believe this is a direct consequence of legal obstacles in the market.

Soffer added: “The much-needed energy transition will not be possible without democratising the energy system.

“If successful, this case could transform the French system into a truly competitive, flexible and consumer-centred market.”

ENDS

Notes to editors

The court case will take place in the Council of State at 2PM local time on 22 June 2020. It is not open to the public.

Legal case – argumentation

The claimant in this case is challenging the concession contract granted in 1993 and renewed in 2012 by the Municipal Council of Lyon to EDF/Enedis for the exclusive operation of the electricity distribution network in Lyon. Local authorities like Lyon are responsible for the negotiation and the conclusion of concession contracts for the operation of the distribution network. Our lawyers argue that the exclusive rights granted to EDF/Enedis to operate the distribution network do not comply with EU energy laws. They also argue that the concession-granting procedure does not comply with EU transparency and competition law standards.

Community energy in EU law

The European Union set a new legal framework called “Clean Energy for all Europeans” also known as “Clean Energy Package” to help the EU meet its 2030 climate and energy objectives. It is comprised of four directives and four regulations published between June 2018 and June 2019, and will have to be implemented in the coming years by Member States.

With this new legal framework, the EU has signalled a strong shift in the role of citizens from passive consumers to active participants in the energy transition. For the first time, EU law introduces the concept of “citizen energy communities”, enabling consumers in the same neighbourhood or building to generate, store, sell or share their own electricity, operate networks like distribution networks using things like rooftop solar panels, batteries, and charging stations for electric vehicles.

Half of all European Union citizens could be producing their own electricity by 2050, and meeting 45% of the EU’s energy demand.

French electricity market, renewables and community energy

Enedis is a subsidiary of EDF in charge of the public distribution of electricity. It has expressed its reluctance to the emergence of energy communities in the past, which a group of organisations including ClientEarth responded to.

Before the EU Green Deal was announced the EU wide target for renewables share in final consumption by 2030 is 32.5%. According to the Clean Energy Package, France’s renewables contribution should be at least 33%. However, existing French energy legislation has not been sufficiently remodelled in order to create the conditions to reach this target.

The share of energy from renewable sources in gross final energy consumption in France reached 16.6% in 2018, far from its own target of 23% by 2020 and the common EU target of 20% by 2020.

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