France needs more solar subsidies cuts, government study says

New installations should be capped at 300 to 500 megawatts (MW) a year, wrote Jean-Michel Charpin in a report published on the finance ministry’s website September 3. France is on track to surpass its 2020 target for installed solar capacity by 2013 as companies rush to profit from inflated tariffs, he said.

Before Charpin’s report was made public, the government said it would cut the so-called feed-in tariff on September 1 for a second time since January, to counter a speculative bubble in the industry. The move is the first in a planned solar-policy overhaul in coming months that may include an annual growth target of 500 MW, the government said at the time.

Five hundred MW “won’t be nearly enough to develop equipment manufacturers in France,” Richard Loyen, head of the solar industry group Enerplan, told Bloomberg via telephone. “This is a report, not a new policy, although we know the minister will likely base his plan on it.”

Declining costs for making photovoltaic panels are forcing governments to reduce subsidies shouldered by consumers when they pay for electricity from renewable sources. Spain also plans to cut solar prices while Germany reduced the price for sun-generated electricity from July.

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