District heating network: the city of Paris chooses Dalkia's offer over Engie's

This decision, the result of five years of work, will be submitted to the Paris Council in mid-December. At stake: heating for nearly one million people in the capital and 16 neighboring municipalities, including all Parisian hospitals, supplied by an underground network of more than 500 kilometers.

The offer from Dalkia, a subsidiary of EDF, was deemed better than that of Engie, the concession holder for almost a century, in view of the "massive greening" of the energy mix of the heat network that it proposes, "which will allow us to get out of fossil gas", explained Dan Lert, deputy to the Socialist mayor Anne Hidalgo in charge of ecological transition and energy, during a press conference.

Some 3,4 billion euros will be invested over 25 years so that the heat in the network is produced by 76% renewable energy, instead of the current 50% (waste incineration, biomass combustion, geothermal energy...).

The equivalent of 200.000 additional homes will be able to "abandon their gas or oil boilers," Dan Lert specified.

The Green Party representative also highlighted the "excellent guarantees regarding tariff control," which should allow for "stability in Parisians' energy bills."

"We will be able to lower prices in 2027, from the start of the concession, for 69% of users. This reduction will be particularly marked for housing and we will be able to control them during the 25 years of the concession," assured Dan Lert.

This century-old district heating network – the largest in France and one of the biggest in the world – is currently operated by a semi-public company, CPCU, owned 66,5% by Engie and 33,5% by the City of Paris. This concession will end on December 31, 2026.

"This is obviously not the outcome we expected given the quality and ambition of the offer that was presented by the Engie teams," the energy company reacted in a statement.

The group will be compensated to the tune of 3 million euros for the costs of the bid, the town hall specified.

The new contract will allow the city to become the owner of the 12 heat production plants through the creation of a new mixed economy company, 49% owned by public actors (the city and Caisse des dépôts) and 51% by Dalkia.

The choice has drawn criticism from the opposition. David Alphand, co-chair of Rachida Dati's group, denounced a "hasty allocation" four months before the municipal elections, calling it "the final underhanded move" by the outgoing socialist municipality.

"Announcing the awarding of the heating network four months before the municipal elections is to deprive Parisians of a democratic choice that should have been decided by the future elected team," lamented Pierre-Yves Bournazel, Horizons candidate for mayor of Paris.