Fearing Russian gas shut-off, France’s industry turns to oil By Reuters

News



© Reuters. FILE PHOTO: The logo of French tyre maker Michelin is seen on a Formula E racing car in Rome, Italy May 17, 2016 REUTERS/Alessandro Bianchi//File Photo

By Mathieu Rosemain and Leigh Thomas

AIX-EN-PROVENCE, France (Reuters) – France’s energy-intensive companies are speeding up contingency plans and converting their gas boilers to run on oil as they seek to avoid disruption in the event any further reduction in Russian gas supplies leads to power outages.

Gathered over the weekend at a business and economics conference in southern France, several top executives said they were preparing for possible blackouts.

“What we’ve done is we’ve converted our boilers, so they’re capable of running on gas or oil, and we can even switch to coal if we need to,” said Florent Menegaux, the boss of Michelin (EPA:), one of the world’s leading tyre-makers.

“The aim is to avoid having to shut down a plant in case we face a shortage,” he added, saying that while a gas shortage in Europe was likely, oil would still be available as an alternative.

It takes days to start up tyre production at a manufacturing plant, Menegaux said, making it essential to maintain a steady energy supply.

Russia in June reduced flows through the Nord Stream 1 pipeline, its main route for shipping gas into western Europe, to 40% of capacity. Politicians and industry are concerned there will be further supply constraints linked to Russia’s invasion of Ukraine, which Moscow describes as a “special military operation”.

Across Europe, industry has been resorting to more polluting fuel than gas as it gives precedence to tackling the cost to the economy of business disruption and surging energy prices, rather than longer-term targets to switch to zero carbon fuel.

French Finance Minister Bruno Le Maire told the top corporate executives attending the conference it would be irresponsible not to prepare for shortages.

“Let’s prepare for a cut-off of Russian gas,” he told them. “Today it’s the most likely scenario.”

France, relies on nuclear power for around 70% of its electricity, meaning it is far less directly dependendent on Russian gas than neighbouring Germany.

However, the state-controlled electricity producer EDF (EPA:) is struggling to meet France’s needs because of outages at its ageing power plants, increasing the strain on the rest of the energy sector.

Energy production at 29 of its 56 nuclear reactors has been halted by inspections and repairs.

The French government is checking company-by-company which ones depend on an uninterrupted energy supply.

It has also sought to reduce the impact of a surge in energy prices by capping retail gas and power prices until the end of the year, which has helped to keep French inflation among the lowest in Europe.

A chairman of another large industrial company, who asked not to be named, told Reuters on the sidelines of the conference he believed all big businesses were looking at a switch to oil.

Automaker Stellantis is weighing options to produce its own energy in case of an energy crunch, Chief Executive Carlos Tavares said at a French factory last month.

These include building its own energy plant or investing in an existing one to secure part of the production.

Poland’s former energy minister Michal Kurtyka, whose country relies on coal for 70% of its energy, told executives at the conference that Europe was headed for a “perfect storm” this winter.

Leave a Comment

Leading the way

Let's build a better world together

Project planning
Design expertise
Great qualifications

Nullam vestibulum finibus sapien, id consequat mauris tempus auctor.

Locations

90 Newport St., Natick, MA 01760

83 Taylor Street, Kings Mountain, NC 28086

22 Birch Hill St., Villa Rica, GA 30180

Support requests

support@construction.com

Nullam scelerisque leo felis, quis congue mauris tristique in. Suspendisse pulvinar, felis eu facilisis mattis, turpis odio luctus nisi, et ultrices velit enim quis lacus.

Request a quote

[Insert your contact form here]

Construction

Vivamus vehicula dictum elit at bibendum. Etiam finibus eros ut urna auctor ullamcorper. Sed at erat eget nisl rutrum ultrices sed eu ex.

Newsletter

Sign up to receive the latest news and trends from our company.

More questions? Get in touch