France: FIT reductions continue

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The remuneration depends on the type of installation, up to 100 kilowatts (kW) in size. There are more than ten different tariffs. For residential photovoltaics up to three kW, for instance, the FIT has declined by more than 15 percent, to 38 euro cents per kWh (/kWh) since March 2011. For other residential rooftop systems between 36 and 100 kW, the cut amounts to more than 25 percent to 21.4 euro cents/kWh.

For industry organisation Enerplan, which represents more than 250 companies and installers, this is more than enough. During 2011, the industry lost "half of the 25,000 jobs that had been created until then," the association said in a statement.

Enerplan has proposed "two simple measures" to stop the erosion and turn it into a "new upswing". The first is to stop any further tariff decline in 2012, or at least prevent the next one scheduled in April. The second is to change the system of tenders, which the government introduced last year for all installations bigger than 100 kW, and to return to a fixed scheme of FITs on a lower basis and differentiated by size, type and geography.

The organization further proposes to decrease the tariffs on an annual basis until 2017, when grid parity is expected to be achieved. According to the organisation’s presentation, from 2012 to 2017, the FITs for systems between 100 and 250 kW shall drop from 21 to 17 euro cents, while systems between 250 kW to two megawatts (MW) should receive a tariff of between 20 to 16 euro cents, and those sized two to 12 MW, between 18 to 14 euro cents.

It argues that the tender system has not led to any decision yet. "The realisation of these projects will not begin before autumn 2012. This timeframe is extremely long, the costs of development as well as the uncertainty destroy every day more the economic potential and expertise of the photovoltaic in France."

According to the French government, the process of application and selection of photovoltaic projects in the two tender systems is still underway. Therefore, since March 2011, no such system could have been realised in France.

With the new proposals, Enerplan positions itself for the forthcoming elections of the new French president, which will begin this April. Until now, the socialist candidate Francois Hollande, who leads in opinion polls before incumbent Nicolas Sarkozy, hasn’t presented his program yet.