October 19, 2017 / 3:48 PM / a year ago

Retailer Casino turns up the heat in French residential power market

PARIS, Oct 19 (Reuters) - French retailer Casino has entered the French retail power market through its online subsidiary Cdiscount, offering retail customers a 15 percent discount to regulated electricity prices, the company said on Thursday.

Casino joins a growing list of French companies trying to win customers from state-controlled utility EDF, a former monopoly that still has the lion’s share — 84 percent — of France’s market of 32.1 million customers.

Earlier this month, French oil company Total said it would undercut EDF and Engie — which hold a 75 percent share of the residential gas market — with a 10 percent price discount on electricity and gas, setting the scene for a possible price war.

Total said it was targeting 3 million clients still tied to EDF’s regulated prices within five years. Casino did not set a target, but said French households could reduce their bill by 342 euros ($405) a year with its unlimited offer.

“While the majority of the country’s population still get their electricity from longstanding suppliers, French consumers appear ripe for a change if the rates offered are more competitive,” Cdiscount said in a statement.

The company, which described itself as the leading French non-food online retailer that generated 3 billion euros in business volumes in 2016, is hoping to lure customers through is online presence. It buys electricity from the wholesale market in France and other European countries.

However, ten years after France liberalised its energy market, retail customers have shown little interest in moving from the former monopolies and regulated prices. A study published by French energy mediator on Tuesday said 50 percent of clients did not know they could easily change supplier for cheaper offers.

French energy market regulator CRE said in September that the share of French residential clients who have moved to market-based electricity tariffs rose by 6.7 percent in the second quarter of the year to 5.2 million.

Cdiscount said an opinion poll it commissioned showed that 82 percent of French customers think their energy bills are high or very high and 60 percent are thinking about changing supplier.

More than 30 alternative gas and electricity suppliers operate in the French retail market including Direct Energie and Italy’s Eni which launched its residential offer in March.

EDF has said it is not worried about the new entrants in the market and is confident that it will keep a comfortable market share. ($1 = 0.8445 euros) (Reporting by Bate Felix. Editing by Jane Merriman)

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