The French government’s decision to fully nationalize electricity giant EDF will not be emulated in the rest of Europe. Although some mention similar movements in other Member States, the French case is isolated because of the existing public control and because it is not a strategic asset in other markets.
EDF is also in critical condition due to several factors: the problems that its nuclear power stations are experiencing due to stress corrosion which affects part of its fleet, the increase in the construction costs of the British power station Hinkley Point C and the regulatory interventions of the French government . Indeed, during a public appearance before the Senate, the French Nuclear Safety Authority explained that, to solve these problems, EDF would require a large-scale plan which could take several years and the cost of which is difficult to predict.
In this unfavorable context for the firm, the State already had control of the company by holding 84% of its capital. With this movement, it intends to take back the 16% which is in the hands of minority shareholders and bear the costs that the revitalization of the company will entail.
Other European countries – such as Italy, Sweden, Finland, Denmark, Austria, Greece or Poland – have public companies. However, in the vast majority, public representation is considerably less. This is the case of Italy, which stands out from the French model by remaining a minority shareholder in the country’s energy companies. Enel – parent company of Spanish company Endesa with a presence in a total of 30 countries around the world – holds a 23.59% government stake. Today, the country would not have the capacity to buy the remaining 76%.
The same goes for the French Engie, 23.64% owned by the State; also the Austrian Verbund, with 51%; the Finnish Fortum, with 50.67%; or the Polish PGE, with 47.83%. In Europe, there are also fully public companies, such as Sweden’s Vattenfall or Norway’s Statkraft.
The Spanish case
The last public electricity company active in Spain until the early 2000s was Endesa. It was in 1988, under the socialist government of Felipe González, that it began to be privatized with the initial public offering of part of its capital. In the following years, the privatization of the company continued gradually.
Currently, in Spain, the big energy companies are totally private. Only the operators of electricity and gas systems have a minority public interest. These are Redeia (formerly Red Eléctrica) and Enagás.
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