Bon appétit? November, 2009: A new recipe could improve France’s PV feed-in tariff with extra incentives and new intermediate level. But confusing details have led to mixed reviews The French government has come out with a draft proposal to revise a complicated and largely ineffectual PV feed-in tariff. But despite improvements and additions, the proposed replacement seems destined only to intensify the inscrutable complexity of French PV bureaucracy if approved for introduction on Jan 1, 2010. And that is not good news for a market that could only boast a cumulative grid-connected installed capacity of 134.5 MW as of June 30 this year while leaving many systems looking for a way to hook up to the grid. The dense details were announced on Sept. 9. by the likewise densely-named Ministry of Ecology, Energy, Sustainable Development and the Sea, essentially a fancy title for the environment ministry. This latest version for 20-year payments would maintain a base PV tariff of 32.8 euro cents (46.9¢) but with installations above 250 kW able to get as much as 20 percent more depending on how far north they are installed. A 60.2 euro cents (86.1¢) per kWh for building-integrated PV systems would also be kept (see PI 6/2009, p. 56), albeit with a yet-to-be determined definition of what its »highly aesthetic« designation will cover. Most perplexing, however, is a new intermediate tariff level of 45 euro cents (64.4¢) per kWh for »simplified integration.« Although poorly described in the proposal, the phrase most likely refers to retrofits using standard modules. But not only would the modules have to be laid out in the same angle as the surface – leading to uncertainty what this will mean for flat roofs – the minimum size is limited to 3 kW. The result is that once again France has left a large portion of its potential non-BIPV residential market out in the cold without the extra support many had been expecting since confusing revisions were introduced in November 2008 (see PI 12/2008, p. 20). The quest for »good architecture« Nonetheless, the BIPV tariff, a level proudly promoted by French environment minister Jean-Louis Borloo as »the highest in the world,« is arguably attractive enough to convince some residential owners of existing structures to redo roofs with solar tiles. But its real draw would more likely be for the new-build market – at least once it has been properly defined. A commission is to be formed, including units of Borloo’s ministry and the Ministry of Housing, to come up with a list of acceptable equipment for installers. However, rather than this tariff starting at the beginning of 2010, the ministry says the BIPV details would not be ready until June. While Benoît Rolland, the CEO of French-headquartered module manufacturer and installer Tenesol, considers the move commendable, saying it maintains the French tradition of »respecting good architecture.« he considers the ministry’s timing optimistic at best. »It’s going to be a long process,« he predicts, perhaps taking as much as two years. As for retrofits on existing roofs using the new intermediate tariff – meant only for enclosed buildings rather than open structures such as on farms – Marc Jedliczka, strategy manager at the Lyon-based solar NGO Hespul, is concerned. He claims that in order for homeowners to install systems above the 3 kW limit, they would have to register as companies, resulting in a reduced value-added tax benefit. And given that the proposal contains what Jedliczka calls the »crazy« stipulation that modules be in the same plane as the surface, he says systems on flat roofs would either have to be laid out at a disadvantage for yield or use angled mounting systems, thus dropping per kWh payments down to the base tariff of 32.8 euro cents (46.9¢). Andreas Semmel, the head of the solar installation firm TerraSource near Marseille, agrees. He says that even when visible, large flat roofs for the most part »are ugly« anyway. The shame of it, Semmel adds, is the uncountable number of square meters that could end up going unsolarized, rooftop sites he notes that would not be confronted by the opposition sometimes faced by large solar farms on the ground. The call of the north This is a reference to the base feed-in tariff level, largely aimed at big ground-mounted systems that have ruffled the feathers of some residents in the south, especially France’s beloved vineyard belt. In a move to increase interest away from these better-insolated regions, the environment ministry is proposing increases to the tariff for systems above 250 kW (including on large flat rooftops). The amount would be raised by up to 39.4 euro cents (56.4¢) per kWh – 20 percent – depending on how far north the installation is located. According to Hespul’s Jedliczka, this would be based on a coefficient related to the measured insolation in the 95 departments in metropolitan France. Thierry Lepercq, the director of Paris-based large-scale PV installer Solairedirect, finds the addition enticing. »With the pricing of modules falling,« he says, »we figure that close to 90 percent of the French territory is going to be workable for solar parks.« This means Solairedirect would be able to move beyond locations, such as the southern region of Provence, where the company started a 25 MW ground-mounted installation in August with €100 million ($143 million) in financing, which is slated for completion by February. Lepercq’s main concern is the adjusted tariff could be too high, possibly leading to speculation. Certainly, with top tier western module prices having fallen to €2 ($2.86) per W (and Chinese modules even much lower), combined with a tariff that could work all over the country, investors are bound to flock to France, setting up PV for a possible backlash from unhappy ratepayers and politicians. Still, Lepercq is not worried that France will face a Spanish boom-and-bust syndrome due to multi-gigawatts of PV being installed in just a few months – for 2010, he is estimating an installed capacity of up to 500 MW, far below the Spanish experience. What will happen to feed-in tariff support in France’s four overseas departments and the Mediterranean island of Corsica is unclear – the ministerial proposal only says they will »profit from a specific scheme,« without giving details or a timeline for an announcement. Certainly, the interest is there. Tenesol, for example, will complete a 15 MW solar farm on France’s volcanic territory of La Réunion in the Indian Ocean for the renewables arm of the country’s largest utility EDF by the end of the year. The feed-in tariff is not officially capped, although France has a goal of 5.4 GW by 2020. If approved, the proposed tariffs – adjusted annually for inflation – would stay in place through 2012, and then drop 9 percent in 2013, a degression most of those interviewed expect to be repeated annually. A backlog waiting for connection But despite the ministry’s assertion that the administrative formalities for application approval procedures have been simplified, getting connected is another matter. As Hespul’s Jedliczka sees it, the problem is that France’s main utility Electricité de France (EDF) is trying to keep a competitive edge for its renewables business unit, EDF Energies Nouvelles (EDF EN). This a reference to a July 23 announcement from EDF EN, saying it was setting up a joint venture with the US-headquartered CdTe thin-film module giant First Solar Inc. to build a factory in France with a capacity of more than 100 MW by 2011. The payoff? EDF EN would get First Solar’s »entire output« for the first 10 years of production. Jedliczka’s implication is that EDF is trying to slow down the whole installation process of installing PV in France until it has its own module supply in hand. EDF did not respond to questions. And it appears there is a lot of PV waiting for a home on the grid. According to the government’s own statistics department, as of June 30 nearly 25,000 systems, equal to 1.9 GW, were either waiting to be installed or already installed but not yet connected to the grid in France and its overseas departments. While RTE, France’s transmission operator, responsible for the connecting the utility-scale PV systems to the high-voltage grid, did not respond to requests for information, Electricité Réseau Distribution France (ERDF) did. One of the job of this wholly-owned EDF subsidiary is connecting the smaller PV systems on the mainland to the low-voltage lines. According to Myriam Doumbouya, an EDRF press spokeswoman, her company has been handling the waiting list »in a transparent way and without discrimination.« And this in the face »an exponential growth« in requests to just over 25,000 in 2008, more than a 350 percent increase over the previous year. And getting connected is getting faster, she adds. Doumbouya claims ERDF has been able to slash the time from application submission to installation commissioning in half to under 4 months for »small installations.« At the same time, she says EDRF was able to more than double the number of PV connections to the grid to 12,600 in the first half of 2009 compared to the six months before that. And all the buzz seems to be attracting business. On Sept. 22, two weeks after the ministerial announcement, German-headquartered integrator Phoenix Solar AG announced it was setting up a French subsidiary in Lyon to start this month, citing a »huge growth potential« for the French market as the magnet. Also opening in October is a new PV manufacturer, Sillia énergie, with a 20 MW capacity manufacturing plant in northwest city of Lannion. Starting with multicrystalline modules, it will add monocrystalline panels to the mix by the end of the year. The company plans to double overall capacity to 40 MW in 2011. So far, however, France’s installed capacity to date has been less than stunning – just 46.4 MW of systems connected to the grid in the first half of the year on the mainland, plus another 7.2 MW in the overseas departments. Still, Solairedirect’s Lepercq is confident that the annual total will climb to 200 MW by the end of the year. Indeed, he is »pleased« by the new proposal, expecting it to lead to a strong growth of the French PV market in the next few years. TerraSources’s Semmel calls the introduction of an intermediate tariff for non-BIPV systems »great news,« despite its limitations on minimum size and its disadvantage for flat roofs. Tenesol’s Rolland praises »the continuity« of a stress on BIPV although concerned that getting connected to the grid still takes a long time. As for Hespul’s Jedliczka, who has been working tirelessly for years to convince the French government to formulate a feed-in tariff that would open up floodgates to the country’s market, he remains frustrated. While acknowledging improvements, he finds the new proposal »regrettable« – not the per-kWh rates, but the restrictions that have been woven into its fabric. Although vowing to push for changes before the tariff takes effect on Jan. 1, realistically Jedliczka says he will have to wait for the next major chance to amend the details. When? In 3 years when the tariff will most likely be reviewed again. William P. Hirshman © PHOTON International, November 2009 Duplicate only with allowance of PHOTON Europe GmbH, Aachen, Germany  back