French National Assembly and the Senate reach compromise on the Renewables Acceleration Bill

On 24 January 2023, the French National Assembly and the Senate agreed on and adopted a compromise text on the Draft law on the acceleration of renewable energy production to quicken the development of green energy projects. The bill plans to boost renewable energy capacity to 154 GW by 2050 (adding 90 GW solar, 40 GW offshore, and 20 GW onshore wind) and remove the many bureaucratic hurdles. The news comes at a time when France fails to achieve its renewable energy targets second year in a row.

Summary

File : Projet de loi relatif à l’accélération de la production d’énergies renouvelables (Draft law on the acceleration of renewable energy production).

Main objectives: total 180 GW of solar and wind by 2050 and cut red tape for developers of renewable energy projects.

Legal status: not yet in force.

·       passed reading in the Senate and the National Assembly

·       final vote in the Assembly on 31 January 2023 - adopted, in the Senate on 7 February 2023

Application period: from 2023 onwards.

Market impact: increased French GO issuance mid to long-term, the impact won’t be felt instantly. The government signed the Offshore Wind Pact which plans to bring at least 2GW of offshore wind per year between 2025 and 2050.

Context

France is the only country in the EU that failed to reach its 2020 target to have 23% of renewables in its final energy consumption (it was short of 3.9%) and now faces a penalty of half a billion euros. The need for rapid acceleration of renewables deployment is even more urgent considering that the revision of the Renewable Energy Directive (III & IV) will see the EU-wide RES target increase in the final energy consumption to 40-45% by 2030, depending on the outcome of the trilogues. This means that France’s RES target will increase to reflect this, in line with the Governance regulation, whereby the EU will allocate varying RES shares to its Member States.

The bill came prior to the adoption of the EU’s third emergency measures package aiming to speed up renewables deployment by reducing permitting times for RES projects. You can get an overview of the bill and the market impact here. Note, under the Renewable Energy Directive IV (RED IV), the RePowerEU plan, and the emergency measures, permitting times for renewable projects are different. This creates a difficult legislative environment for investors to navigate, and as France introduces new rules ahead of the RED revision, investors cannot rely upon a cohesive regulatory landscape. As the bill follows an accelerated procedure, after the green light from the Assembly, a joint commission bringing together both the Senate and the Assembly representatives met on 24 January  2023, where a compromise text was agreed on. A final vote on the text occurred on 31 January 2023 in the Assembly (adopted, with editorial changes only), and will take place on 7 February 2024 in the Senate.

Earlier, the text was adopted by the Senate with an overwhelming consensus (320 for, five against), demonstrating broad political consensus and support for the renewables, while the vote roll-out in the Assembly reveals deep divisions between the parties (286 for, 238 against).

If the bill is adopted in its current form, there could be potential conflicts with the revised Renewable Energy Directive. However, the bill is in line with the third package of emergency measures. Deadlines at the EU level are not yet definitive and are still under discussion. Nevertheless, by adopting faster permitting times now, the French are accelerating their energy transition without necessarily waiting for the outcome of RED trilogues, scheduled for 7 February 2023 (RED could be finalised in 2023, and it would take up to two years to transpose it into Member States’ national laws).

Changes

The joint commission agreed on the following changes to the bill:

• Overriding public interest. The parliamentarians returned to a version closer to that voted by the Senate: RES projects can automatically benefit from this principle if they meet certain criteria (Article 4). They will be defined by the government’s decree, the energy source as defined by the energy code and/or power nomenclature. The renewable industry representatives fear that this risks excluding smaller projects, such as small-scale hydropower plants. Note the government still drafts the decree, more details to follow.
• Local authorities receive greater powers to define “acceleration zones”, designated areas where renewables development is fast-tracked, after consultation with the public. Thus, they cannot create renewable energy exclusion zones without defining acceleration zones first (Article 3).
• An obligation to cover the rooftops of new and existing non-residential buildings such as hospitals, warehouses, and schools, with solar panels (Article 11).
• Agrivoltaism. Ground-mounted solar panels will be prohibited on arable land and in forest areas, where their installation would require tree felling (Article 11).
• Permitting process will be limited to three months (Article 1 ter).
• For offshore wind turbines, a ten–year plan for French coastlines will be presented by 2024. It will outline priority maritime and land areas for the installation of offshore wind turbines, with priority given to areas in the exclusive economic zone (Article 12).
• Prior to installing new onshore wind turbines, operating permits will have to consider additional factors, including visual pollution(Article 1 BA, CBA).
• Simplification measures for hydrogen (Article 16 duodecies), hydroelectric (Article 16 quarter and septies) and biogas (Article 16 nonies and undecies) installations are also introduced.

The most observable difference is that both the Senate and the Assembly placed local authorities at the heart of the energy transition, by making them co-responsible for decisions regarding the location of the “acceleration zones”. While a step in the right direction, industry representatives lament that the bill fails to remove the obstacles necessary for the acceleration of renewables deployment.

We will keep you updated on the most recent developments.

*Feel free to arrange a meeting with our Renewable Policy Analyst, Mary, and our Green Power Analyst, Leo, in Paris between February 13 - 16, 2023, where they will be attending the QuiestVert and RECS event on the Guarantees of Origin and Carbon Footprint*