(News Bulletin 247) – The shares of these renewable energy specialists are rising on the Paris Stock Exchange after the arrival in the lead of the New Popular Front (NFP), whose program is more favorable to this type of energy. On the other hand, the threat of the RN coming to power, judged negatively by the market for renewables, is averted.

After starting trading down, the Paris Stock Exchange has turned up. The CAC 40 rebounded by 0.5% late Monday morning.

“End of Act 2 of the legislative elections with more seats than anticipated for the left bloc and without collapse of the presidential majority, the National Rally (RN) finishing in third position”, summarizes Alexandre Baradez, head of market analysis at IG France.

Favorable winds for Voltalia

The scenario of a National Assembly without an absolute majority, which was preferred by the markets, has materialized. This explains the upward movement in several sectors of the rating that had been sanctioned after the dissolution of the Assembly at the beginning of June. This is the case for audiovisual groups as well as renewable energies, which had suffered from the scenario of a potential arrival in power of the National Rally.

On the Paris Stock Exchange, Voltalia jumped 5.1% to 9.70 euros this Monday morning, after having lost more than 20% between the announcement of the dissolution and Friday evening, the last session before the announcement of the results of the second round of the legislative elections. The group, indirectly controlled by the Mulliez family, produces and sells electricity from its wind, solar, hydraulic, biomass and storage facilities.

On the hydrogen specialists side, McPhy rose by 3.9% while Lhyfe appreciated by 1.1% this Monday.

After the results of the first round, Invest Securities highlighted the market’s fears regarding renewable specialists on the stock market.

“The announcement of an RN in the lead in the first round could fuel fears around the cleantech sector which depends heavily on subsidies. For example, in terms of European and French subsidies, companies in the hydrogen sector (McPhy European subsidy of 114 million euros or Lhyfe French state subsidy of 149 million euros), could be significantly impacted if subsidies were reduced in the future,” explained the consultancy in a note dated Monday, July 1.

Scrutinized programs

“Voltalia reacted badly to the political announcements, even though the group has little exposure to wind power in France,” he added.

However, during its investor day held at the end of June, the company had downplayed the political consequences on its business. It had insisted on its low exposure to the French market and the wind sector. But given the reaction of the day, investors themselves did not subscribe to the opinion of Voltalia’s management.

At the end of June, the president of the RN, Jordan Bardella, confirmed during the presentation of his program the objective of “a moratorium on all new construction of wind farms”. However, he ruled out wanting to “dismantle” the wind turbines “currently in operation” ahead of time.

“It is common to say that the RN coming to power would be bad news for renewable energies,” pointed out John Plassard, investment advisor at Mirabaud.

“However, the president of the RN advocates ‘a moratorium on any new construction of wind farms’ but intends to rebuild a photovoltaic sector on French soil ‘in [la] protecting with customs duties at the European level,” he recalled at the end of June. For the specialist, it was “difficult to see clearly” the position of the president of the far-right party.

“As a reminder, Jordan Bardella’s list is, for example, against banning cars with combustion engines by 2035, in favour of stopping the development of wind and even solar energy and described as Eurosceptic,” noted Invest Securities.

On the side of the New Popular Front (NFP), the commitments made in terms of renewable energies are more favorable than those carried by the RN in its program. The left-wing bloc calls for “strengthening the French and European sectors of renewable energy production and developing hydroelectric energy”.