Market Insight

France's energy pledge

February 14, 2018

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On January 25th in Davos President Emmanuel Macron of France has pledged to shut down all coal fire power plants in France by 2021. This pledge further supports France’s progressive energy policy. The current impact will be a near-term transition to combined cycle natural gas power plants, with a long-term focus on renewable energy. IHS Markit estimates that coal and natural gas each account for roughly 6% of France’s current power generation. France’s renewable target is 32% of all power generation by 2030, less than twice as much as the current production of renewable energy at 18.3%, which will leave room for intermediary expansion of gas-fired power to fill in for the reduction in coal-fired power.

Moreover, France is on average a net exporter of energy, but the previously mentioned pledge may result in a balancing effect in the coming years. Other European countries relying on energy imports from France may look to more domestic funding of energy projects in response to France’s transitioning energy policy.

What this means for the generators market is increased demand for medium-power and wind generators. Solar power is expected to increase as well, but currently does not make-up a significant portion of France’s energy production. Furthermore, Macron’s pledge to direct energy resources away from coal will result in a lift to unit and revenue demand for generators in France and the surrounding European region.

Europe France
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Manufacturing Technology
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