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France Approves 214 Solar Power Projects in First Tenders

July 27 (Bloomberg) -- France approved 214 solar projects representing investments of about 1 billion euros ($1.24 billion), its first two competitive tenders for the technology.

The French ministry of environment, sustainable development and energy granted premium rates to projects with a combined 541 megawatts that will be built by the end of 2013, according to an e-mailed statement from Paris today.

Of these, 520 megawatts are projects with more than 250 kilowatts, and the rest are rooftop installations with 100 kilowatts to 250 kilowatts. GDF Suez SA won rights to build a 13.9 megawatt plant, the largest in the tender.

France introduced a new system of so-called reverse-auction tenders in March 2011 for all photovoltaic projects with more than 100 kilowatts, aiming to limit growth. Under this system, developers place competitive bids that include a long-term purchase price for their power. Those offering the lowest rates are more likely to be selected.

The system differs from feed-in tariffs granted in Germany, Spain and Italy allowing PV projects to qualify for fixed above-market rates. That led to a boom in each of the nations, followed by government efforts to restrain the tariff, or in the case of Spain to impose a moratorium on all new developments. France offers feed-in tariffs only for the smallest projects.

French Solar

France had about 2,700 megawatts in solar capacity at the end of 2011 and is likely to reach 4,000 megawatts this year as the remaining projects approved before rules changed are built, according to Bloomberg New Energy Finance.

The competition for mid-sized plants started in August 2011 and the one for larger projects in September. Projects totaling 45 megawatts and 1,891 megawatts, respectively, were submitted for consideration, according to data from the energy regulator. The ministry released the list of winners from its two tenders on its website today, breaking the announcement into larger projects and smaller ones.

About a third of all large projects, or 105 plants, were selected today, including so-called concentrated-solar projects and a 9-megawatt solar thermal plant. Bids for ground-mounted facilities offered an average purchase price of 188 euros to 197.9 euros a megawatt-hour. Those for rooftop projects averaged 210.1 euros, the regulator said in February.

The ministry also said it has commissioned a report on the French solar industry aiming to lower the cost of energy from the technology, spur the development of new systems and increase the competitiveness of the industry. The report will be released on Sept. 13 along with details of the next solar tender.

The previous government planned another similarly sized tender for large projects for 2014 and 2015, seeking to authorize about 500 megawatts in new permits each year.

To contact the reporter on this story: Marc Roca in London at mroca6@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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