The destabilization of the French electricity supply industry nascent competition in an open environment

In February 2000 France, compelled by the 1996 European Directive 96/92, undertook a minimal reform of the organisation of its electricity industry, while preserving the boundaries of the incumbent company. The aim of this paper is to analyse the conditions of destabilization of the industrial organisation of the French ESI, by identifying the economic factors of endogenous and exogenous erosion. Firstly, after setting out the main elements of the French reform, which is aimed at making the electricity market contestable, the effectiveness of the ''contestability'' of the French power market is discussed. Secondly in order to test the stability of the new institutional arrangements, an institutional prospect is developed, on the basis of economic factors of instability and resistance, to produce two contrasting scenarios: one in which the particularly French model is retained (limited contestability market scenario); another in which there is movement towards a de-integrated competitive model (contamination by competition scenario). Thirdly the author concludes on the basis of recent elements, that the future would be a mix of these two trajectories which will come within in the progressive integration of the national markets in continental Europe. (A.L.B.)