France’s Ministry of Ecology, Sustainability, and Transport has reported the installation of 720 megawatts (MW) of PV in continental France and its overseas territories in 2010. This brings total installed capacity to over one gigawatt (GW) for the first time.
France now has the seventh-largest installed PV capacity in the world, after Germany, Spain, Japan, Italy, the U.S., and the Czech Republic. The Ministry expects that between one GW and 1.5 GW of new PV will be installed in 2011 and 2012.
Though the government didn't release the number of central-station, ground-mounted projects, the vast majority of French solar installations are in distributed applications. There were 13,000 projects greater than three kilowatts (kW), representing 70 percent of total capacity installed in 2010. Only 92 projects installed in 2010 were greater than 250 kW, for a total of 128 MW.
Several ground-mounted projects in the pipeline will be installed in the next several months, and some of the projects that were under development before the government's moratorium will proceed under the previous policy.
As already reported, as a means to limit costs to ratepayers, France’s Ministry has set a new target of 500 MW per year for the installation of PV. In comparison, Germany, one of France's main trading partners, has recently reaffirmed its target of 3.5 GW per year.
To restrict the type and number of installations, all rooftop projects greater than 100 kW, but less than 250 kW, will have to respond to a "simplified" Request for Proposal (RFP) or "call for tender" as it is known in Europe. Winners of the RFP will be chosen on several non-price factors and will receive the fixed tariffs.
However, all rooftop projects greater than 250 kW, and ground-mounted projects of any size will have to respond to a more conventional RFP. Winners will be based on price, environmental impact, innovation, and other factors. Thus, PV projects greater than 250 kW will be effectively removed from the French feed-in tariff program.
The use of RFPs reflect the famed French penchant for centralized control and administration, preferred by French Governments since Louis XIV (the "Sun King") concentrated power in the hands of the Versailles nobility.
The new proposal gives the Ministry all decision-making authority regarding who will and will not install PV greater than 250 kW. Critics suggest that this is not only a way to rein in the rapid growth of solar, but also a recipe for favoring preferred contractors.
As recently as early 2010, the Ministry raised tariffs for PV, as well as for geothermal, and biomass. At the time, solar advocates warned the French Government, to no avail, that they were in danger of overheating the French PV market at the expense of the entire renewable energy program. See 2010 French Tariffs Raise Price for Solar, Geothermal, and Biomass.
Over cost due to fossil fuels, not renewables
With the rapid growth of PV in France, there have been accusations that renewables have created a huge debt in un-funded utility charges.
France collects a public goods charge, the Contribution au Service Public de l'Électricité (CSPE), from electricity consumers in order to pay for renewable energy, fossil-fired combined heat and power, and for the bills of consumers who can't pay them themselves.
In an unusual twist on the concept of public goods charge, the CSPE also pays the over cost that can't be recovered in rates of generating electricity from fossil fuels in French overseas territories. Consumers in French overseas territories pay the same electricity rates as Parisians, even though the cost of generating electricity is far higher than in continental France.
Electricité de France (EDF), the partially privatized utility serving France and its territories, has for several years not been collecting sufficient funds to cover the cost of the CSPE.
From 2007 through 2010, EDF had run up a debt of €2.8 billion. The cost of renewables represents only 10 percent to 15 percent of the total unfunded debt. The cost of fossil fuels accounted for 70 percent to nearly 90 percent of the debt, says the Comité de Liaison Energie Renouvelables (CLER). This is the same time period when oil prices reached their zenith, before crashing along with the global economy.
The situation with the CSPE in France is not dissimilar to that in Spain, where the over costs of fossil-fuel fired generation during the run-up in oil prices in 2007 and 2008 were attributed to the costs of renewable energy.
Critics note that despite wind energy's steady growth of one GW per year, it is insufficient to meet France's renewable energy targets. The new limits on PV - one-seventh the annual target of Germany - will only exacerbate the problem.
Nevertheless, the French Government's action illustrates the flexibility of feed-in tariffs as a policy tool by raising the tariffs for the technologies they want, while lowering those of the technologies they fear.
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