France: Fonds Chaleur Underperforms in Solar Thermal Sector

The French national support scheme Fonds Chaleur has had little effect on the solar thermal sector. Since the start of the programme in April 2009, only 5% of the total investments in approved projects have involved solar thermal technology according to a press release from the French Energy Ministry at the 11^th of October 2012. The biomass sector – residential and non-residential – accounts for 56% of the total volume. The number of annually approved solar thermal projects has even been decreasing year after year. Whereas 404 solar thermal installations had received funding in 2010, Ademe only registered 224 systems in 2012. “In the current year, the number of approved projects in solar thermal is again smaller,” explains Michel Cairey-Remonnay, Programme Coordinator of Fonds Chaleur at Ademe, and adds that one of the reasons for the low demand is that “solar thermal technology is still too expensive”.

“Fonds Chaleur appears complex and could be more popular among homeowners in the segment of multi-family houses if it were not for the complicated application procedure,” Daniel Mugnier, Researcher at French company Tecsol, says, giving a second reason for the rather low performance. This criticism must be seen in relation to the average project size. On average, a solar thermal installation which received funding from Ademe cost around EUR 100,000 – a number which is 25 to 54 times less than in the district heating and biomass sector. According to the press release mentioned above, the average investment of projects in district heating was EUR 2.5 million and it was even EUR 5.5 million for projects in the biomass segment in the industrial, the agricultural and the tertiary sector. Considering that all projects require the same administrative work, the time and effort that has to be put in processing a solar thermal application is relatively high.

Statistical data from programme administrator Michel Cairey-Remonnay. Ademe’s press department could not be reached to confirm the figures.

The table above shows the strong decline in the annual number of applications in the solar thermal sector, whereas the total investment volume per year in all technology fields did not decrease that much. These figures lead to the conclusion that the demand in biomass, district heating or geothermal remains high, whereas only solar thermal is becoming less and less popular. According to Cairey-Remonnay, 70 % of the solar thermal applications come from the residential sector, around 30 % from the tertiary sector, whereas the industrial and agricultural sector together account for merely up to 20 projects per year.

By December 2012, Ademe had already granted subsidies of EUR 835 million from the EUR 1 billion originally allocated to the five-year project period between 2009 and 2013. At the end of 2013, the programme will again need approval by the government to be extended further. “We expect a confirmation within the new energy law that is planned for autumn 2013,” explains Cairey-Remonnay. This revision would also be a great chance to simplify the application process and aim to decrease system costs by lowering the level of incentives.

More information:
http://www.ademe.fr
http://www.solaire-collectif.fr/index.php?pid=4
http://www.tecsol.fr

Press release of the French Ministry for Ecology, Sustainable Development and Energy:
http://www.developpement-durable.gouv.fr/Le-bilan-du-Fonds-chaleur.html