France suspends tenders for self-consumption solar projects

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The French Ministry for the Ecological and Inclusive Transition has decided to suspend tenders for for self-consumption PV projects under net metering, according to a statement from France’s Energy Regulatory Commission (CRE).

The regulator said the tenders were suspended after the fifth tender round was largely undersubscribed. It received applications for just 19.4 MW of combined solar capacity, although 50 MW was allocated to the round.

The CRE also said the tenders, which were open to self-consumption projects ranging in size from 100 kW to 1 MW, have only been temporarily suspended. It added that they will be resumed after improvements are made to the support system of the tender mechanism.

However, this lower volume is leading to final higher tender prices, the regulator claimed, noting that net-metering tariffs almost doubled from around €17.7/MWh in the first round to around €30.3/MWh in the latest round. Two-thirds of compliant applications are entitled to tariffs between €25 and €30/MWh, which is very close to the ceiling for the period. It is also above the threshold of €25/MWh, beyond which rates would be too generous for project developers, the CRE said.

It was already clear by last June — when the CRE allocated just 2.2 MW in a 50 MW round —  that the tenders were not working properly.

Xavier Daval — a representative of French renewable energy association SER and CEO and president of KiloWattsol SAS — said the tender mechanism failed mainly because it almost exclusively favors clients with 100% self-consumption rates such as supermarkets, which can use all of the generated electricity for refrigeration. The net metering tariffs are subject to the payment of CSPE on power bills to raise funds for France’s renewable energy programs, which is making the lower self-consumption rates of projects unprofitable.

“We agree that the tender rules must be modified, and we asked the government to do it in June, when first signs that the procurement exercises were not working out,” Daval said, while also claiming that the CRE decided to suspend the tenders unilaterally, without consulting the solar sector.

Through self-consumption tenders, the French government is supporting the deployment of rooftop PV on buildings, greenhouses, agricultural facilities and carports.