The French government has proposed a sweeping plan to double the amount of energy provided by solar power and other renewables by 2020, according to a Reuters report. The incentive plans call for a massive increase in installed photovoltaics as part of the package, which seeks to increase to 23% the amount of total energy provided by green sources in France over the next 12 years.
French Environment and Energy Minister Jean-Louis Borloo presented a total of 50 measures to achieve France’s targets, including multiplying production of geothermic power six-fold by installing heat pumps in two million households. “France’s ambition is to play a leading role in the technological revolution which is about to happen in solar power,” he said in a statement.
The government said it would seek tender offers by the end of this year to build at least one solar power plant for each of France’s regions by 2011, with a combined total capacity of 300 MW.
Biomass power plants and offshore wind farms are also part of the French plans. “The development of each energy source has to respect the landscape, the cultural heritage, the quality of the oxygen and water and biodiversity,” said Borloo.
Barclays Capital Solar Energy issued a brief report following the announcement of the French program.
“Current incentive program in France includes Euro 30c/kWh feed-in-tariff for residential rooftop applications and Euro 55c/kWh for BIPV applications,” it said. “In addition to these incentives, the government now plans to provide Euro 45c/kWh incentives for large commercial installations.
“The French government plans to raise solar power output to 5400 MW by 2020 from less than 50 MW in 2007. Prior targets were to install up to 3000 MW of solar power by 2020.
Implications for the new program include benefits for companies such as First Solar and SunPower “that have a strong presence in the large-scale commercial solar projects market. We believe the higher incentive level for commercial installations could likely act as a positive demand catalyst and possibly mitigate some pricing pressure if financing conditions improve in 1H09.”
The Barclay note explains that “the primary incentive mechanism in France is in the form of a feed-in tariff for duration of 20 years, with the annual tariff increase pegged to inflation. France is making a renewed effort to increase the renewable share of the country’s total energy consumption from 10.3% in 2005 to 20% by 2020.
“The European Union has further increased this target to 23% by 2020. France benefits from very favorable solar irradiation conditions, especially in the south and in overseas territories,” the note continues. “With what we believe is an attractive feed-in tariff scheme, combined with a special bonus for building integrated PV installations and an income tax credit for private individuals, the French government paved the way to rapid growth in PV installations.
“In 2007, thanks to the full effect of the legislative environment that came into force in July 2006, new installations grew to 45 MW, a 221% year-over-year increase.”
Barclay sees France as “one of the fastest-growing markets with a CAGR of more than 90% until 2012” and expects the market “to grow to more than 1 GW of installations by 2012 and contribute 0.1% of the electricity generated.”