In November 2022, in its business tendency surveys, INSEE questioned companies in the industry sector (with more than 20 employees) and the services sector (regardless of their size) on the nature of their energy contracts (electricity and gas), on past and expected change in the energy prices they are facing, and on their reactions to these price increases.

The impact of the energy crisis depends mainly on the type of contract that each company has signed and its expiry date. In industry, 44% of the companies surveyed said they get their electricity via a fixed-price contract over a contractual period. Of these, almost half said that this contract expires at the end of 2022, and for almost a third their contract expires during 2023, which therefore potentially exposes them to a considerable increase in market prices. If we add the 21% of companies whose contracts are indexed to the market price, then more than half (56%) of industrial businesses are particularly exposed to the rise in electricity prices. With regard to gas, this proportion is about two-thirds of those industrial companies using gas (i.e. about three-quarters of all companies). For those companies whose contracts expired in H2 2022, they have already been affected by market conditions.

It is more common for service companies to have an electricity supply contract at a regulated tariff, or indexed to this tariff (around 45% of these companies). Nevertheless, 27% would seem to be particularly exposed to the electricity price rise. In services, far fewer companies use gas than in industry and they are concentrated in accommodation-catering and real estate services.

Because of these differences in contracts, price rises would necessarily be very varied. For example, 42% of industrial companies expect their unit price for the purchase of electricity to at least double in 2023 compared to 2022, while a quarter of them did not expect any particular price rise over the same period. The average increase expected by business leaders is 132% for electricity (after +75% estimated by companies in 2022). However, these price rises that companies have declared may not take into account all the available aid schemes.

While the majority of companies (65% in industry, 31% in services) say that they intend to pass on at least some of this energy price increase on to their own sale price, a significant proportion expect to see a reduction in their margins, and a smaller proportion (8% in industry, 3% in services) expect to reduce their activity as a result of this rise. All in all, the decline in industrial production linked to the rise in energy prices is expected to be of the order of -1.5%. In addition, INSEE’s Avionic model based on these survey results suggests that the distribution of the energy price shock in 2023 could result in an increase in producer prices of almost 4% in industry...