Gaz de France is considering a legal appeal against the French government imposed retail gas tariff ceiling, claiming it is not financially viable.
The possible legal move was revealed by the utility giant’s chief executive Jean-Francois Cirelli at the company’s annual general meeting, the AFX news agency has reported.
Mr Cirelli said that GdF was considering the legal option after being disappointed with the French government bequeathing just a 5.8% increase in retail gas prices, which will not be reviewed until July 2007.
GDF had requested an 8.1% rise in prices to cover the significant recent rise in wholesale gas prices. The company believes the government directive will leave it running its domestic retail gas business at a loss because procurement will cost more than retail income.
It’s a difficult situation for us. All options, including legal ones, will be used, AFX reported Mr Cirelli as saying.