The photovoltaic sector in France at its lowest ebb

Grenelle de l’Environnement, solar energy, fossil energyBoosted by strong market growth in the 2000s, the photovoltaic sector is now suffering from production overcapacity. Although the sector’s medium-term prospects remain promising, solar panel producers are currently experiencing difficulties.

In France, the stakeholders are organizing themselves

Since spring of this year, the sector’s major stakeholders have been coming together for formal meetings called “les États Généraux du Solaire”, focused on the solar industry. Panel manufacturers, electricity producers, installers, and professionals in the field of electrical efficiency have put forward several suggestions to help increase their business and ensure they do not miss the upturn of the global market expected to occur by 2020.

As part of these suggestions, the industry players are insisting on increasing the “photovoltaic objective” set by the French government, from 5 to 20 gigawatts of electricity to be produced in 2020 (summary of their work in PDF). Though initially stimulated by the first French environment round table called Grenelle de l’environnement in 2007, the solar energy industry is now criticizing the French government for its lack of financial support. This support is deemed crucial to reinforce the position of the French players on the domestic and global markets.

International competition is also weakened

Today, the main manufacturers of solar panels are American (First Solar) and Chinese (JA Solar, Suntech). Due to their particularly aggressive pricing, Chinese manufacturers are criticized by the French photovoltaic sector, which denounces the protection and subsidies these manufacturers receive from the Chinese government (Les Echos, 15/11/2011).

The new prospects for growth are identified mainly in Europe, but because of the financial difficulties Europeans are currently facing, there is some concern that the market will elude them. As reported by GreenUnivers, a website which specializes in the topic of green business, all industry players are suffering from production overcapacity, because the global demand has slowed compared with the 2000s.

A complex industry

This situation does not affect the medium-term prospects of this business sector which boasts increasingly powerful technologies. Until then, the industry will have to overcome several challenges, including the optimization of connections to the electricity grids, as these will have to become both simpler and smarter.

All industry players will also have to convince homeowners, local governments, and businesses that a solar installation is the right solution. Thierry Mueth, President of Enerplan (an association that includes 170 of the industry’s players), says that the ever-increasing price of fossil fuels will make photovoltaic electricity competitive by 2016 (Le Figaro, 15/11/2011). The group also told Enerzine that in order for the industry to create jobs, the local authorities and French government will have to adopt a proactive policy with, in particular, a more stable legal and fiscal framework. The association emphasizes that this could potentially lead to the creation of 100,000 jobs with high added value – jobs that cannot be moved offshore.

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