Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Like health care, it's true that power generation is a great example of what government usually does best than the private sector.

Having lived in California at the moment of the so called 'energy crisis' of 2000 has made it abundantly clear to me that letting private company deal with such a strategic resource is a very dangerous game. California is still paying for that folly.

That being said, rejecting ANY participation of the private sector in EDF seems a bit like a knee jerk reaction to me. I'm not a financial analyst, but it seems to me that injecting private money could help EDF compete worldwide and be a good investment opportunity for the people. As long as it's done right and the government retains a clear majority, i don't really see a problem with that.

by Greg a Bordeaux on Mon Sep 5th, 2005 at 05:57:01 AM EST
You have a point, but my objections to partial privatisation are as follows:

  • even if it is only a few %, privatisation makes it necessary for the company to focus on profitability. As discussed above, the easiest way to do that is to press on the workers. There are certainly areas of EDF where efficiency could be improved, but hte fact is that if you change one part of the overall equilibrium, you lose other thigns as well. If the workforce is squeezed, they will be less motivated and may end up caring less about quality and reliability and have less initiative where needed.

  • this point is not applicable in the current European regulatory framework, but my position is that EDF should not only be State owned, but also benefit from a State guarantee to borrow money at the interest rates offered to the soveeign rating - in order to be able to invest over the very long term and reap the formidable cost savings of compounded lower interest rates.

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Mon Sep 5th, 2005 at 08:58:55 AM EST
[ Parent ]


Occasional Series