04/10/24
France's wind sector weighs impact of new government
London, 4 October (Argus) — Doubts over government policy on onshore wind
competed with optimism over offshore wind at the French wind sector's annual
conference in Paris on Wednesday. The event took place a day after the first
policy announcements of prime minister Michel Barnier , in which he said his
government would "better handle the impacts" of wind energy. No more detail is
available on what this will mean exactly, although far-right party Rassemblement
National (RN), which props up Barnier's minority government, is strongly opposed
to wind energy. And of two of the parties in his coalition, president Emmanuel
Macron's EPR and Barnier's own Les Republicans (LR), the former is supportive of
wind, while the latter is more sceptical without being downright opposed, one
developer told Argus . While junior energy minister Olga Givernet told the
conference of her intention to reduce the delays developers face, participants
Argus spoke to feared Barnier's evocation of "impacts" could mean an expansion
of barriers to building new capacity. "We already take the impacts into
account," one developer said, noting that firms perform extensive studies and
undertake environmental impact assessments (EIAs). And legal challenges are one
of the main obstacles slowing down capacity increases, with one developer
calling for better-trained judges to reduce the number of "arbitrary" decisions
made in these cases. Delays in receiving grid connection and EIAs were other
factors developers cited. But the conference was more upbeat on offshore wind.
The government will in the coming weeks announce priority zones for offshore
wind, which will allow it to launch tenders for 8-10GW of capacity by the end of
the year. These will contribute to the country's goal of reaching 18GW of
installed capacity by 2035. At the same time, the increasing occurrence of
negative price hours threatens the sector, according to industry body France
Renouvelables. Negative prices can pose a threat to grid stability, according to
grid operator RTE. Large quantities of renewables can be shut down suddenly at
the beginning of negative price hours, leading to a sharp output slope, which
the grid operator has little visibility of, RTE said. Negative prices are a
problem for operators too, even those under contracts for difference (CfDs)
which are not directly exposed, according to Jean-Francois Petit of renewables
operator Boralex. Operators typically shut down during negative pricing hours,
but receive only partial compensation for lost output, he said, while the
requirement that production be completely halted can be difficult operationally.
And slow progress on repowering could represent another brake to capacity
increases. Repowering is not underpinned by primary legislation, but only by
ministerial circulars, one developer said, which offers little certainty to
firms that want to undertake it. Meanwhile, height limits imposed for aviation
constraints and landscape protection reduce the potential to add taller, more
powerful turbines. French turbines are typically much smaller than those in
neighbouring countries because of these height limits, which reduces access to
higher-quality wind resource. And an open question remains over potential local
content requirements in future tenders for CfDs. These requirements, enabled by
the European Net Zero industry Act (NZIA) and supported by energy regulator the
CRE, could prove a fillip for manufacturers of energy-transition materiel such
as wind turbines, hobbled by competition from Chinese manufacturers. But
incorporation of these requirements would push up costs, requiring higher strike
prices at CfDs and more public subsidy. Energy minister Givernet did not appear
to give the conference any hints on which way the government would lean, saying
that control over both energy prices and security of supply were absolute
priorities. Reaching France's goals by 2028 of 33.2-34.7GW of onshore capacity
would require an installation rate of 2.3-2.7 GW/yr, roughly twice rates reached
in recent years ( see graph ). By Rhys Talbot France onshore capacity and 2028
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