How did France revolutionise its energy mix in the 1970s?
Short link: https://bit.ly/31Utf0Q
Cécile Fraysse (PPD Master’s)
Global warming raises, in dramatic fashion, the question of the energy mix. France has already been through a major energy mix change, in the 1970s, when it turned towards nuclear energy. That choice profoundly transformed the country’s energy history. What economic and political forces drove that decision?
In the 1970s, a number of technologies were used to produce civil nuclear power, including natural uranium graphite gas reactors (French technology), and boiling water and pressurised water reactors (American technology). During the 1979 oil crisis, France opted for the pressurised water technology.
Cécile Fraysse’s Master’s thesis reveals, through contextualisation work, the public policy choice and the economic arguments used. Several lessons can be drawn from her work. First, Électricité de France (EDF) had anticipated a possible squeeze on the oil markets and modelled a rise in the price of oil (even if this was shown to be lower than the price later became). Despite a high discount rate through the 1970s, other factors favoured the nuclear power choice. Among others were the EDF estimates of investment costs, based on the costs of nuclear power stations being built in Belgium, and on studies conducted in the United States, which in reality could give only an approximate idea of the investment costs in France. In addition, EDF’s economic calculations did not take into account the escalating costs of the nuclear option. Indeed, the oil crisis itself had an impact on the costs of nuclear energy. Finally, the assumption about consumption (a doubling every 10 years, based on the historical trend) also supported the turn to a massive project of nuclear power. While the EDF’s assumptions were shown to be wrong, the explosion in the price of fuel oil explains ex post the rationality of the nuclear choice according to the technical-economic method of calculation.
The economic calculation – initially made by EDF engineering economists and reconstructed by Fraysse through the compilation of archival documents – justified a decision that was essentially political, by demonstrating that the American technology was more feasible than both fuel oil and the French nuclear technology. It is noteworthy that the EDF’s economic calculations did not take into account either the level of risk associated with nuclear power or the question of the management of radioactive waste. A consensus formed within French institutions (e.g. the ministries of industry, the economy, the National Assembly), and the issue of the environmental impact of this energy form was limited to the possible risk of a warming of the rivers. The nuclear choice was also favoured by the centralisation of the state in France. France was still a catch-up economy after the Second World War, and the nuclear programme helped to promote an image of the country as “flourishing”. Nevertheless, the financing of its development via the Messmer plan was done with private funding backed by the state. The EDF borrowed on foreign markets (mostly American), a break from the funding model for the hydraulic programme.
The research presented here is all the more relevant now given that climate change has brought the energy question back to the centre of public debate. At the same time, a change in the energy mix is no longer a question left to engineering economists. This thesis reminds us that the results of modelling, of estimates, are always subject to highly specific assumptions that arise from particular social constructions.
Master’s thesis title: Du pétrole à l’atome : étapes et financement de la transition énergétique française post-1973
Supervised by: Eric Monnet (PSE)
Available at: https://dumas.ccsd.cnrs.fr/MEM-PSE/dumas-03461211
Contact: cecile.fraysse at acpr.banque-france.fr - LinkedIn Profile
Visual Credit : Christian Schwier - shutterstock