How could Engie benefit from the reform of hydropower in France?

研报英文原文证据摘录

How could Engie benefit from the reform of hydropower in France?

Bartlomiej Kubicki +49 69 717 4418 bartlomiej.kubicki@bernsteinsg.com 23 June 2026

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France has adopted a new legislation reforming its hydropower sector. The bill, adopted on Wednesday 17 June, requires EDF

- operator of around 20.7GW of hydropower capacity, representing roughly 80% of mainland hydropower - to auction 6GW

of ‘virtual’ capacity over a 20-year period. The reform is intended to resolve a long-standing dispute with the European Union

and unlock billions of euros in investment for new hydroelectricity capacity. The European Commission has consistently pushed

France to open up the hydropower market by ending the automatic extension of concessions and introducing competitive

tendering. This development comes as no surprise, following the agreement in principle reached between France and the

European Commission several months ago.

EDF has outlined plans to invest approximately €4.5bn in the medium term to add 4GW of hydropower capacity in France. Other

operators will also be impacted: Engie’s SHEM (785MW of concessions) will transition to an authorization regime (without the

auction requirement), while Compagnie Nationale du Rhône (CNR, 3.1GW of capacity - 50% owned by Engie) is exempt,

already benefiting from a specific regulatory framework.

The French state, which will retain ownership of the infrastructure, will have to compensate the early termination of

concessions. Operators will also have to pay an occupancy fee. An assessment will calculate the amount of these balancing

payments, which should be ‘overall favorable’ for the State, according to the finance ministry. Le Monde reports that timeframe