France: Renewable energies will bring 31 billion euros to the State in 2022 and 2023

The renewable energy sector, especially wind turbines, will bring in 30.9 billion euros in revenue for the state in 2022-23.

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The renewable energy sector, and in particular wind turbines, will bring in 30.9 billion euros in revenue for the state in 2022-23, the Energy Regulation Commission (CRE) reassessed on Tuesday.

The energy regulator, which in July estimated this amount at 8.6 billion euros, has revised its forecasts upwards, thanks to the rise in electricity market prices.

“CRE predicts, under current wholesale price conditions, that all renewable energy sectors in mainland France will represent revenue for the state budget,” she notes.

In this set, wind power brings the bulk of the revenue, up to 21.7 billion euros, the photovoltaic sector for 3.5 billion, the hydraulic sector for 1.7 billion, and biomethane injected into gas networks for 0.9 billion.

France owes this favorable situation to the existence since 2003 of a special support mechanism for renewable energies: the State guarantees a certain level of electricity purchase price to renewable energy operators, who in turn pay the difference when market prices exceed this guaranteed price – which is the case today.

At this rate, the renewable energy sector should soon have paid back everything it has received over the past twenty years.

These revenues for the state budget will help finance the tariff shields and shock absorbers designed to protect consumers and businesses from soaring energy prices, CRE said.

But while the context of market prices is more favorable to producers, CRE also warns on Tuesday about the early termination of these support contracts by some RE producers: in July, these termination requests concerned a cumulative installed capacity of 1.3 gigawatts
(GW); at the end of September, this volume exceeded 3.7 GW.

These cancellations will result in a cumulative loss of 6 to 7 billion euros for the State over 2022 and 2023, CRE estimates at this stage.

“These facilities could only be developed thanks to the financial support of the state, which they received for periods generally exceeding 10 years. It is completely abnormal that the producers concerned leave the contracts guaranteed by the State a few years before their expiry to take advantage of high wholesale prices,” adds the commission, which recommends strengthening the taxation of infra-marginal rents provided by the EU for these facilities.

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