French PM warns over risk of energy rationing this winter

French Prime Minister Elisabeth Borne warned company bosses on Monday about the risk of energy rationing this winter and urged them to take steps to reduce their consumption.

"If we act collectively then we can overcome the risk of shortages, but unless everyone takes part and if all the bad-case scenarios come together then we could be forced to impose reductions on consumers," she told the Medef business group.

"If we end up with rationing, companies will be the most affected and unfortunately we need to be prepared for it," she continued.

Borne said the government was already drawing up contingency plans, including a "quota trading system" that would enable companies to buy and sell power quotas.

The government was also preparing measures to support companies that would be "too severely affected" by rationing.

The clear warning about the risk of shortages further underlines efforts by the government to prepare public opinion and businesses for looming difficulties caused by the ongoing war in Ukraine.

Speaking last week at the first cabinet meeting since the August summer holidays, President Emmanuel Macron warned that France might need to make "sacrifices" as a result of what he called the "end of abundance".

"Every company needs to mobilise and act. I call on everyone to establish their own energy-saving plans in September," Borne continued, while stressing that the crisis would help the transition away from fossil fuels.

"The months ahead are just a step in the bigger transition that we need to make," she said.

France is more sheltered than many European countries from the surge in gas prices caused by Russia's decision to reduce its exports to Europe after its invasion of Ukraine in February.

France generates some 70 percent of its electricity from a fleet of 56 nuclear reactors, but 32 are currently offline either for routine maintenance or to evaluate corrosion risks.

Borne said that "the restarting of reactors that have been shut is essential to avoid blackouts."

Macron struck a more upbeat tone during a visit to Algeria last week where extra supplies from the North African producer were discussed.

"We are not going to have any problems because we depend very little on gas," Macron told reporters in Algiers on Friday. "We have one pipeline with Norway. We increased the volume and we've diversified things."

He pointed to a new terminal able to process liquefied natural gas (LNG) in the northern port of Le Havre, as well as efforts to fill French gas stock facilities, which are 90 percent full.

"So from a purely French perspective, things will be ok this winter. The issue is a European one," Macron explained, saying that "solidarity" might be needed to help out fellow EU partners who are more dependent on Russian gas.

Gas accounts for around 20 percent of France's overall energy consumption, but is used as a power source for less than 10 percent of its electricity, statistics from the International Energy Agency show.

French Energy Transition Minister Agnes Pannier-Runacher told the Medef meeting that the weather was "the most crucial factor of the months ahead".

Claire Waysand, deputy chief executive of energy supplier Engie, added that "to be sure that we get through winter with enough electricity and gas, we have an interest in it not being too cold.

"If so, then there might be days when there are real tensions."