France Faces Power Price Decline Amid Stagnant Demand and Nuclear Maintenance Challenges

France is entering 2026 with declining power prices, attributed to stagnant demand, strong nuclear availability, and increasing renewables output. The Cal-26 forward contract is assessed at €49.75/MWh, below the €60/MWh spot delivery predicted for 2024 and 2025.

French hydro reserves are lower than in previous years, and EdF anticipates reduced nuclear power production due to planned maintenance. Demand recovery over the next few years will influence the validity of forward pricing.

Although there are 30GW of industrial and data center projects with reserved capacity, demand growth is uncertain, with estimates ranging from 2.7GW to 6.3GW by 2030. Political challenges and a lack of demand growth may hinder the expansion of renewables and nuclear capacity.

EdF is initiating the construction of new reactors, but past delays and financial constraints pose risks. The upcoming PPE3 energy strategy is expected to propose cuts to renewables targets.