6 October 2010


Interview with Thierry Lepercq (Solairedirect) on the status of the French market

Can you briefly introduce yourself and your company? What do you expect to become your company's biggest success in 2010?

Solairedirect is France's second largest solar power producer with 60 MW installed at FYE 2010 (solar parks, residential and commercial rooftops), and a pioneer of the vertically integrated solar IPP model (from module production to development, financing, EPC and installation, operation and ultimately power production and monitoring). Our biggest achievement in 2010 was closing a 80 million-euro solar park project financing which translates into a 15.4 €c/kWh LCOE, a level unmatched until now in Europe.

What are your expectations for the PV market in France in 2010? (in terms of MW/year) and how does that compare to last year?

We expect the French market to range between 500 and 600 MW, which would represent up to 200% growth from 2009.

What do you expect to happen next year (with respect to demand) and in 2012? Currently, it looks like the Government will reduce the FiT again in 2011 and is planning to change the tax benefits as well. What will be the impact on the market?

The government is likely to set a reference scenario of 500 MW per annum for the years to come, as was set forth by a recently published report from the Ministry of Finance ("Mission Charpin"). Demand in 2011 will probably exceed that number (between 600 and 800 MW) as many projects are completed during the transition towards the new regulatory regime. In 2012 the severe tariff cuts under the new corridor system to be introduced (up to -17% annually) plus the likely unworkable tender mechanism applicable to ground-mounted installations should result into a stable market at best, and more likely a fall from 2011.

France has installed a huge amount of nuclear power and is even exporting a lot of nuclear electricity. What is the government's strategy and target with respect to PV? Is it to develop a domestic market or domestic industry? Will solar electricity ever be able to compete with nuclear in France in a fair way?

What is interesting in France is that we are now seeing a part of the nuclear establishment move towards a concurrent nuclear and solar option for the country, the two being seen as complementary (centralized and distributed) towards the common goal of carbon-free energy. It is worthwhile noting that France's central nuclear body, CEA, was recently renamed CEA2 (Commissariat à l'Energie Atomique et aux Energies Alternatives) and has a fast growing solar research institute, INES. One caveat though: the nuclear establishment expects solar energy to be much more price competitive, and wants a massive deployment of manufacturing in France, with even a view to exports.

France has two major companies dominating the energy landscape and both seem to have close ties to the Government. How does this help or frustrate the French market development?

As surprising as it may be, the first phase of the development of PV has come about by a large extent from the lobbying efforts of EDF's renewable energy unit and its maverick boss. For a number of reasons (including the careless advocacy of ever-higher feed-in tariffs) these efforts have now backfired and there is no longer strong support for solar energy, and renewable energy in general, from France's two large utilities.

What are the major solar pv market segments in France and what trends in market development do you see? Where do you expect the biggest growth: with ground mounted projects, commercial or residential roof systems?

The latest government report clearly favors rooftops (especially smaller ones) with a very distinct BIPV bias. It pushes a view of solar as part of the construction industry, contributing to the trend towards energy efficiency and ultimately energy-positive buildings. The local job content is one reason which explains such a choice. Until solar becomes price competitive with other sources of energy (around 10 euro cents/kWh) we see no future for ground-mounted installations in France.

What are the biggest challenges and the biggest opportunities in your market? Some experts say the administrative procedures and insurance requirements are even more difficult than in Spain and Italy. What is your experience and view?

Permit application procedures for ground-mounted projects are long and tough - and they should be, because ultimately a project with insufficient impact assessment ends up in court, courtesy of local environmental groups, as is the case for instance for most wind projects in France. For rooftops the BIPV requirements certainly complicate the insurance picture - and add significant costs.

What is your forecast in terms of MW/year of new installations in France for the years 2011-2013?

My best estimate is 700/600/500, not including a paradigm shift towards 10 c/kWh solar power, which could turn France into a GW market within a few years.

What would be your advice to the Government to make pv project development in France easier?

It would be naive of us to expect a combination of high feed-in tariffs, tax regulations and no caps. It is a recipe for another boom-and-bust horror story as we have seen elsewhere in Europe. Things should be approached strategically. On the rooftop market I would say that we should go for a 1-million PV rooftop plan including energy efficiency and smart grid system. For the rest, we should try and encourage large scale PV at competitive prices (10 c/kWh), as well as build a strong French PV industry to feed the whole system. Otherwise we will never gain the strong and enduring political support that is so essential.

Thank you for the interview!

Thierry Lepercq will be one of the speakers at the conference "The Solar Future France". Interested in the French solar market? Join us at The Solar Future: France |

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