In 2024, the sun shines on solar panels, marking a decisive turning point for renewable energy in France. With a significant increase in solar electricity production, the country seems ready to take a new step. However, behind this euphoria lies a major challenge: the government had to reduce subsidies and other incentives in the face of an alarming budget situation. This dynamic, although promising, raises questions about the future of solar energy and the ability of individuals to engage in self-consumption. Let’s see together how these changes are affecting the solar landscape in France.
A rapid development but under conditions
Photovoltaic solar is undoubtedly the renewable energy that is experiencing the fastest growth. In 2023, due to massive solar panel production by industries, particularly in China, equipment costs became more accessible. Whether for the installation of solar parks or panels on rooftops, the rise is undeniable.
But beware! This rise does not come without challenges. Solar energy production remains intermittent, and its theoretical production capacity is often limited to about 20% over the year. Moreover, the required surface area for electricity production installations can be substantial, not to mention the overwhelming competition from the Chinese industry which, to survive against falling prices, has even set up a cartel.
Reduction of public aids: a new paradox
With the state’s financial situation in difficulty, the government has decided to revise downwards its support scheme for solar installations. Instead of the ambitious objectives of 100 GW by 2035, the target has been revised to only 90 GW, and for 2030, it is now fixed at 54 GW. Such reductions could have significant repercussions for individuals wishing to invest in solar energy.
- 🌞 Reduction of subsidies: The investment grant capped at 80 euros per kWc instead of 210 euros.
- 🔄 Impact on self-consumption: Partial sale of production to EDF is now impossible.
- 📉 Revisions of purchase rates: The buy-back rate for photovoltaic electricity has fallen, impacting the return on investment.
Beyond the mere revision of objectives, these new measures raise questions: how to encourage the adoption of self-consumption if the economic framework weakens?
The year 2024: a new impetus for self-consumption
Despite adjustments in aids, 2024 has proven to be a dynamic year for solar. Individuals have massively turned to self-consumption, leading to record installations of solar panels on rooftops. In fact, solar electricity production rose by 8.4%, reaching 23.3 TWh, representing 4.3% of the country’s total electricity production.
What impacts for new installations?
The ambitions regarding renewable energy are becoming clearer, but it is not without complications. Industry professionals such as TotalEnergies, EDF Renouvelables, and Engie are adjusting their strategies to cope with a rapidly changing market. For consumers who can install solar panels, this means:
- 🔧 Ease of installation: The brand new solar panel models are designed to be installed in record time.
- 💵 Potential savings: Savings on electricity bills can be substantial.
- ⚡ Sale of electricity: Some installations can still benefit from old rates until July.
The economic challenges of the energy transition
With the rise of solar, the state finds itself faced with a paradox. On one side, a strong desire to promote this energy source and on the other, public finances in decline. Connecting new installations to the grid requires colossal investments, which Enedis estimates at 10 billion euros between 2022 and 2040. This amount raises questions about the economic viability of the sector.
The buy-back rates for electricity produced by photovoltaic panels have seen a dizzying drop. Thus, the buy-back price for installations of less than 9 kWc has fallen from 12.69 euros per kWh to 4 euros. As for installations between 100 and 500 kWc, despite slight protection until this summer, they should anticipate significant changes as well.
| Type of installation | Buy-back price before (in euros/kWh) | Buy-back price after (in euros/kWh) |
|---|---|---|
| Installations of less than 9 kWc | 12.69 | 4 |
| Installations from 100 to 500 kWc | 95 (until July 2024) | To be determined |
Repercussions on historical players
Historical players such as Photowatt, Akuo Energy, Soleos, and Sunnco are also feeling these changes. How to adapt to a changing framework while preserving the profitability of their projects? This requires significant agility to regain the trust of potential clients. Additionally, market dynamics imposed by aid reductions could lead to a rationalization of offers.
FAQ about solar panels and their future
What are the main incentives for installing solar panels?
Currently, the investment grant is about 80 euros for installations of less than 9 kWc, with potential VAT reductions to come. However, the tariff rules are in constant change, particularly regarding the resale of surplus electricity.
How does self-consumption work with solar panels?
Self-consumption allows individuals to use part of their electricity production to power their homes, thereby reducing in some cases their dependence on energy suppliers.
What is the environmental impact of solar energy?
Solar panels contribute to a significant reduction in CO₂ emissions and provide access to a renewable energy source that actively participates in the fight against climate change.
Are solar panels currently profitable?
Profitability depends on many factors: installation cost, personal consumption, and purchase rates. However, the decline in subsidies complicates the economic landscape.
How are connections to the electrical grid going?
Connections are often long and costly, representing a significant financial challenge for many households wishing to adopt solar energy. The costs anticipated by Enedis are substantial and can influence the investment decision.
