The French solar thermal market has been experiencing a series of difficulties over the last decade. The decrease started in 2009, with a fall in single-family house installations, and has been worsening since 2013, when newly installed solar thermal systems started to decline also on the multi-family homes segment.
In terms of volume, the market reached a peak in 2012, with 238 000 m² of collector area installed (167 MWth i.e. 111 GWh) in France (mainland). From then the fall was sharp with only 150,500 m² sold in 2014 (70 GWh) and 66,000 m² in 2016 (31 GWh).
Last year’s results reflect a continued drop: only 52 000 m² (36 MWth) were installed, representing a production capacity of 24 GWh in 2017.
Overall, France (mainland) has an annual production capacity totaling 1,100 GWh, with an estimated solar thermal collector area of 2,345,000 m² (1 642 MWth).
Looking more closely at the product range, a trend emerged in 2017 on the single-house market, with combi-systems (for both domestic hot water production and space heating) riding against the tide: 4,600 m² were installed last year compared to 4,500 m² in 2016. We can only assume that this system is now benefiting from a greater awareness in the market, given that combi-systems yield a higher self-consumption rate than individual solar water heaters, even if their original purchase price is higher.
On the downside, domestic solar water heaters remain on a steep downslope with newly installed collector areas down 28% to 18 000 m² on the single-family housing market.
Medium- and large-scale systems (both in domestic and non-domestic applications) were down 21% in 2017 to 29,000 m².
The collapse of the French solar thermal market can be explained by a combination of several factors.
Considering the new buildings segment, the main problem identified by Enerplan (the French trade association of solar professionals) lies within the building regulations: the French RT2012 (thermal regulation for new buildings, dating back from 2012) has less strict standards than the previous regulation in terms of energy consumption thresholds. In essence, the basic demand was originally set at 50 kWh/m². year (multi-family homes), although an exemption was later granted, allowing an extra 15% of energy to be used. This resulted in a reduced need for renewable heat in general out of which solar thermal would be an option, in order to meet legal requirements. This exemption should have been lifted in 2015 but was extended, first to December 2017 and then beyond. With regards to the single-house market, again, low requirements in terms of energy consumption have basically led to a massive shift to DHW heat pumps (thermodynamic water heaters): cheaper as an investment, easier to install than solar thermal systems, they suffice to meet the minimum regulatory requirements.
On the top of this, as early as in 2013, errors were identified in the regulatory calculation tool made available to engineers to help them choose the appropriate technologies and products when designing a new building. These errors meant that solar thermal solutions were undervalued by 15% - 18% in the calculations. Although the problem was finally solved in 2017, it has not helped solar thermal much, as it is facing other problems than building rules as well. Although solar thermal systems have the potential to be cost competitive in the long run, initial costs are presently still high (installations are still around € 1,000 per m2), and a lack of interest from maintainers as well as counter references for existing systems (around 150 audits were lead in between 2012 and 2017 which pointed out that only 40% of the systems were working satisfactorily) are still slowing down the market recovery. Engineers need to be informed about market innovations and performance data, since they are still reluctant to prescribe these solutions because they have doubts about the cost effectiveness in the long run.
Nevertheless, some grounds for hope can be found in recent developments. To start with, a law passed at the end of 2016 enables local authorities to grant larger surface occupation ratios in building permissions for projects in which energy consumptions are 20% lower than required by the RT2012 regulation. A study by Crigen engineers (Engie R&D Lab) published in early 2017 ("Positionnement technico-économique RT 2012 des solutions solaires thermiques et concurrentes en secteur résidentiel dans un contexte de bonification du COS") established that solar thermal technology is one of the few technologies that can meet this lower level without having to increase the building’s insulation, anywhere in France (for more details see the French SOCOL leaflet published in 2017, "Solaire thermique, la nouvelle dynamique"). Also, reaching a lower level of energy consumption opens the way to grants from the ADEME agency, even for new buildings. Finally, the new experimental E+C- (Energy +, Carbon -) government label, paving the way to the next set of thermal regulations into 2020, should benefit solar thermal systems as its application should result in a low carbon impact.
Looking at the renovation sector, as can be said for renewable heat technologies in general, the decrease in fossil fuel prices has largely contributed to the loss of market share for solar thermal. This downward trend has been affecting the return on investment, both for single-family and multi-family homes and also in the industrial, agricultural and tertiary sectors as well as other potential users (hospitals, hotels, etc.). Hence, when the French government announced a raise in the "carbon tax" (Contribution Energie Climat) at the end of 2017, effective from 2018, prospects started to improve for renewable heat and for solar thermal. Fuel and natural gas prices are set to grow by 35% within the next 5 years and should double within the next 12 years. A study updated by the I Care & Consult consultants in March 2018 ("Etude de compétitivité de la filière solaire") established that it is already cheaper today, looking over a 20-year period, to invest in a solar thermal installation than to keep an existing fuel or gas boiler, anywhere in France, at a cost of € 900 per m2 and including a subsidy of 50%):
Please refer to the French SOCOL leaflet: "Rénovation + solaire thermique, la nouvelle dynamique" for more details.
Finally, part of the decrease can be explained by the lack of knowledge of potential customers (both for housing and commercial uses) for solar thermal technologies and a lasting confusion with the more popular photovoltaic applications. This weakness has been further worsened by a drop in confidence from buyers and investors. This is due to the fact that communications about some faulty or failing installations have hampered trust in the industry: indeed, the French market went through a period of quick and strong growth from 2006 to 2012. During these years, high demand had to be met by a limited number of professionals who had, until then, been trained and equipped to provide the needs of a very small – if not niche – market. This resulted in a shortage of qualified specialists and a lack of quality control procedures. Since then, the industry has worked hard to achieve better standards (new qualifications, new technical and legal procedures...). However, work still needs to be done to restore complete confidence in the technology. The SOCOL taskforce, initiated by Enerplan in 2009 and financially supported by ADEME, has been working toward this goal (see further down: Other Key Topics). Prospective buyers and project owners need to be informed on the progress made by the whole of the solar thermal industry, particularly in the last 5 years. It is also crucial that they should be informed of all the free tools and advice at their disposal on the SOCOL website to help them with their project.
In this context, the French energy roadmap (Programmation Pluriannuelle de l’Energie or PPE) has set targets for the development of renewable energy, including solar thermal. The target set for 2018 was an installed capacity of 4,500,000 m²: only about half of this figure is likely to be reached by the end of 2018. Original goals for 2023 were to reach a total collector area between 6,700,000 m² and 9,900,000 m² - this would mean multiplying by 3 or 4 the current installed surface. The industry believes that it is still possible to get closer to those ambitious figures when certain measures and changes in building regulations are implemented.
If no favorable decisions are made to enhance the attractiveness of solar thermal in France (more communication, more training, more incentives, changes in regulation), the solar thermal DHW market should grow by no more than 60,000 to 90,000 m² per annum.
However, installations in the emerging segments (industry and solar district heating or SDH) are estimated to represent a potential of 300,000 to 500,000 m² (cumulative installed base), to be installed by 2023. This figure, though certainly very ambitious, shows a real potential which has not yet been exploited.