Why is ‘nuclear France’ going renewable? The development of political, organizational and European fields
Paper for the ECPR Conference in Oslo. September 6-9 2017 Rough draft; interviews to be conducted
Catherine Banet, Faculty of Law, University of Oslo Jørgen Wettestad, The Fridtjof Nansen Institute [email protected] [email protected]
1.Introduction
The standard image of France is one of an energy mix and climate policy dominated by nuclear energy (e.g. Meritier 2011; Szarka 2011). True, by 2017, France still derives about 75% of its electricity generation from nuclear energy. Nuclear energy has been an overall highly accepted and stable energy provider, despite some controversy over nuclear waste stemming back to the late 1980s. Still: France introduced a feed-in system to enhance renewable energy already in 2000. And the renewable ambitions and activities have increased markedly in the recent decade. Why has more weight given to renewables in French climate and energy policy despite a seemingly moderate societal demand for such a policy development? This is the key puzzle addressed in this paper. As to RES policy development, although a RES feed-in system was put in place already in 2000 a central development occurred in 2007, when France took on the target of achieving a 20% renewables share of energy consumption by 2020, subsequently upped to a binding 23% target in EU Directive 2009/28. Up to then French RES progress had been slow and mostly consisted of biomass and hydroelectric power. An inclusive national energy transition debate then took place between 2012-2014/15, resulting among other things in an ambition to reduce the nuclear share from 75% down to 50% by 2025. As part of the EU setting climate policy targets for 2030 France has now adopted a target of 32% renewables in the final energy consumption by 2030. In the winter 2015/16 a capacity market mechanism
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was introduced and the feed-in system adjusted to a feed-in premium, moving closer to a market-based approach. In order to explain these developments we will describe and analyze, first, the development of the ‘political field’ in France, where as indicated, high acceptance of nuclear energy has been a quite stable feature and a related limited politicization of the renewable energy issues can be noted. Hence a a strong social demand for more renewables does not seem as a plausible explanation. Second, we will address the development of the ‘organizational field’, which on the industrial side has been marked by a dominance of a few large incumbent players, with EDF as the central one and key nuclear operator. However, also EDF is exposed to changes in energy markets sweeping across Europe, with renewables becoming more competitive n neighbouring Germany and the UK. Furthermore there is a complex organizational apparatus governing the renewables issue which has changed over time, with effects for RES policy and development so far unknown. Third, we will address the interaction with the ‘European environment’; both the possible influence of various EU policies and possible learning from RES policy frontrunners such as Germany and the UK. As RES feed-in tariff (FiT) systems involve state support the relationship also to developing EU state aid policies needs to be scrutinized. We claim to be carrying out a little bit of frontrunning ourselves. Previous research in English about the development of French renewables policy and particularly the causal role of internal and external shaping factors is quite moderate, mainly with more general discussions of climate and energy policy (see e.g. Szarka 2011; Meritier 2011) and more ‘technical’ (but certainly useful) discussions of feed-in policy (see Jacobs 2012). Add to this that we have just started interviewing central actors. This means that this paper should be seen as a rough and tentative assessment, with not least the causal statements to be revised and clarified after the full range of interviews have been conducted later this autumn. The paper is structured in the following way: section two outlines the theory and methods framework. Section three carries out a chronological overview of the development of this issue area in France, broken down into four main phases. Section four then ‘confronts theory with evidence’, and discusses how the various focused ‘fields’ may shed light upon the development of French RES policy. Section five winds up the paper with a discussion of main prospects ahead.
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2. Theory and method
The dependent variable is the development of French renewables policy. This includes targets and timetables for the development of renewables in France, but also the introduction and more specific design of financial support schemes and mechanisms to deal with the growth of renewables such as capacity markets. Drawing mainly upon Boasson (2015), as indicated, the explanatory framework distinguishes between the ‘political field’, the ‘organizational field’ and the ‘European environment’.
The political field
The political field focuses on the distribution of political positions and power between political parties. This includes the relative and independent influence of politicians in the parliament, the government and the political parties. Two political field dimensions are particularly interesting: First, changes in the structure of the political field over time are relevant. Such structures include distribution of formal decision making authority between the government and the parliament over time such as majority vs minority governments, changes in legislative decision-making procedures. Second, it is interesting whether policies are disputed or not – to what extent they are politicised. Which energy policy issues have been salient at various points in time, in the sense that they have been an issue of political competition and attracted media attention. How can possible developments within the political field throw light on our puzzle? A tentative proposition can be formulated like this: Increased weight given to renewables in the political parties and increased politicization of the RES issue have led to more weight given to renewables in French climate and energy policy.
The organizational field
The organizational field zooms in on public and private organisations involved in operating and governing, the energy sector. It consists of energy and electricity utilities and other commercial actors, business associations, energy agencies such as regulators, ministries (primarily environment, climate and energy ministries) and environmental organizations such as NGOs, consultancies and think tanks. Relevant issues include the number of organizations, the relationship between them, whether they collaborate or there are conflicts which influence
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the development of renewable policies. In order to shed light on increasing political weight given to renewables one would assume a higher number and a stronger position of actors and organizations pushing renewables over time. Important questions include, firstly, whether authority is centralized within a small group of actors who collaborate with each other (i.e. segmentation) - or rather characterized by many actors in conflict with each other (i.e. pluralism). This dimension of power includes aspects like who are the experts of knowledge and set the agenda with their expertise; for example to what extent public authorities are dependent on expertise from commercial actors or possess relevant information themselves. Second, the key logics or rationales behind the policies that are launched are important. Do most actors align to a common approach to renewables development or are there conflicting norms, worldviews and institutional logics (e.g. market approach vs engineer based approach)? If rationales are conflicting, which are the dominant ones that are being heard and believed? As to the design of policy a general expectation here is that the dominant institutional logic in the sector affects design choices. For example, if there are concerns about costs imposed on consumers, feed-in tariffs are less likely to be adapted than measures which contribute to promote markets and lower prices. Within industry there has been a historical dominance of EDF in France and a slow pace of energy market liberalization. How then can possible developments within the organizational field throw light on our puzzle? Our tentative proposition can be formulated like this: Changed industrial dynamics and an organizational landscape with growing power of ‘renewable actors’ have led to more weight given to renewables in French climate and energy policy.
The European environment
We are also interested in the extent and ways that the EU has influenced the development of renewables policy over time, including the design of support schemes for renewables and capacity adequacy. Furthermore, drawing upon policy diffusion theory, to what extent and how has France learnt from and interacted with other European countries? Boasson (2015) posits that the European environment influences developments of national policy more in areas where the EU has large formal competence than in issue areas where the EU’s competence is minor. She also assumes that the European environment is influential if a certain type of policy design is more prominent than others and considered as
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being a norm of what to do. In such cases policy transfer occurs. Under such conditions she argues that conflicts about how to design renewables policy decrease. A general expectation is for all EU/EEA countries to be increasingly influenced by EU level policies over time, as the EU has gained increasing competence in this issue area and a certain institutionalization around a specific way to design support schemes in EU and EEA countries has emerged. Furthermore, EU influence may be expected to primarily result from national actors that learn from and are inspired by political processes and discussions at the EU level or developments in other EU or EEA countries. The latter element brings in a policy diffusion component and possibility. Other countries such as Germany and the UK have been frontrunners in the development of RES policy and capacities and it is of course possible that French actors have learnt from the successes and failures of other countries. Our tentative proposition here becomes: Changing EU policy and/or learning from the experiences of European RES frontrunners have led to more weight given to renewables in French climate and energy policy. As noted, compared to studies of the renewable policies of countries such as Germany or the UK, the climate and energy politics of France has received scant research attention. Particularly in-depth studies of development over time and main domestic and external shaping forces are lacking. Hence, there is a clear knowledge gap here. However this does not mean there are not any useful material to build upon. In particular, many official bodies (parliamentary committees, regulator, environment agency, etc.) have consistently published reports on the development of renewable energy policy and capacity adequacy mechanisms in France. As to method, we seek to reconstruct the events leading up to key developments of French RES policy over time, scrutinizing main French and EU documents and hence using data from public records, position papers, media coverage. In addition, we are in the process of carrying out semi-structured interviews with policy-makers, stakeholders, and close observers of EU policy-making. Process-tracing provides evidence of whether or not a hypothesized cause was indeed what brought about the outcome (thus reducing the risk of spurious conclusions) and also enables us to uncover causal mechanisms not foreseen by applied theories (see George and Bennett 2005). Although process-tracing has been criticized for not enabling generalizations beyond the case at hand, identifying key political mechanisms behind the evolution of French policy in this issue area may offer causal models of relevance for research on such politics in other jurisdictions.
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3. Historical phases – a chronological ‘thick description’
3.1. Phase 1: prior to 2000 – A turn to nuclear to reduce energy import dependency, but also some RES research After World War II, France entered a period of reconstruction which relied mainly on the deployment of energy intensive industries. Energy demand increased rapidly and the associated energy supply needs were met by the exploitation of domestic coal and increase in hydropower generation capacity. However, the domestic fossil fuel resources were limited in France, which resulted in a situation of high import dependency for the country. Imports stood at 38% of the national energy consumption in 1960 but had increased to 75% in 1973. When the 1970s oil crisis occurred, the French government decided to initiate a new national strategy aimed to ensure energy supply independence. The French government had already expressed its strategic choice in favour of nuclear power in 1945 in the aftermaths of WWII and in the 1960s with the launch of several nuclear programmes,1 but a more ambitious and structure national nuclear power programme was adopted in the year 1974 with the Messmer Plan.2 In parallel, a series of energy savings and energy efficiency measures were adopted and the first research and development programmes in the field of renewable energies were developed (at the National Centre for Scientific Research, Centre national de la recherche scientifique, CNRS). The first measures to support electricity generation based on renewable energy sources were focused on hydropower.3 The objective was the optimalisation of the use of hydraulic resources. In direct relation to the critical energy supply situation of France in the 1970s, the government established several agencies: Agence pour les économies d'énergie (AEE) in 1974,4 Commissariat à l'énergie solaire (COMES) in 1978, Comité Géothermie, Mission
1 The Commissariat à l’énergie atomique (CEA) was established by de Gaulle in 1945. See Maurice Vaïsse, « Le choix atomique de la France (1945-1958). », Vingtième Siècle. Revue d'histoire., no 36, 1992. 2 Messmer P., «Un premier ministre dans le premier choc pétrolier »,
nationale pour la valorisation de la chaleur and the Service économie de matières premières du ministère de l'industrie,5 The COMES then became the first administrative body in charge of renewable energy policy.6 The Agence Française pour la Maîtrise de l’Energie (AFME, i.e. the French Energy Conservation Agency) was established in 1982. AFME became in 1992 ADEME (Agence de l’Environnement et la Maîtrise de l’Energie – Environmental and Energy Conservation Agency). ADEME is a state-funded public industrial and commercial establishment which has a very important role in the whole environmental and energy sector, as further elaborated below. Many of the key actors in the energy sector in France have been founded after WWII, when there was a need to reorganize the sector to face the challenges created by increased energy demand. The Gas and Electricity Nationalisation Law of 1946 led to the establishment of the two state-owned public utility companies Electricite de France (EDF) and Gaz de France (GDF).7 EDF was granted some exclusive rights for the export, import, production, transport and distribution of electricity. EDF became the key operator of nuclear reactors in France (currently 58). The Competition Authority (Conseil de la Concurrence) was established in 1986.8 It has the status of an independent administrative authority. Since then, it has remained an important body in the energy sector. At the EU level, the first Electricity Directive was adopted in 1996, concerning common rules for the internal market in electricity (Directive 96/92/EC) This Directive started a series of changes (Directive 96/92/EC). As to climate and energy policy more generally the 1997 Kyoto Protocol established an overall reduction target for the EU of eight percent by 2008-12 (in relation to 1990). The 1998 Burden-Sharing Agreement redistributed the Kyoto target among the member states. France ended up with a stabilization target in this agreement (Ringius 1999).
5 Decree of 8 March 1978. 6 COMES was in charge of conduction a national energy policy favouring the development of renewable energy sources, e.g. PV, thermal solar, hydropower and biomass. It was also in charge of developing energy savings and energy conservation policies. COMES was in charge of defining relevant projects, financing them and evaluating them. COMES rapidly established an international department in relation to the Ministry of Foreign affairs, and developed multilateral and bilateral relationship with partner countries within the renewable energy and energy efficiency sector. 7 Law No.46-628 of 8 April 1946 8 Ordinance No 86-1243 of 1 December 1986. 7
3.2. Phase 2: 2000-2004: A National Energy Debate and Kyoto Follow-Up The implementation of the above-mentioned first EU Electricity Directive in French law resulted notably in the adoption of Law No. 2000-108 of 10 February 2000. As part of the liberalization process, an independent national regulatory authority was established, the Commission for Energy Regulation (Commission de Regulation de l’Energie, CRE). The role of the CRE evolved progressively, not least to reflect the requirements of EU law. The CRE is today the French independent energy regulator. The President of the CRE’s board is nominated directly by the President of the Republic after consulting the permanent commissions competent on energy matters in the Parliament (comprised of members from both the National Assembly and the Senate).9 At first, the opening-up of the electricity market in 2000 (by Law No. 2000-108 of 10 February 2000) did not dramatically change the energy landscape. The status of ED changed in 2004. It became a limited liability company (Decree No.2004-1224 of 17 November 2004), and a process of privatization began. A FiTs regime was then created by Law of 10 February 2000.10 Law 2000-108 aimed at transposing in French law the first Electricity Directive 96/91/EC, but also at regulating the support for renewable energy sources in electricity generation. The FiT was to be financed through an amount added to the electricity bill of each final electricity consumer. The different feed-in tariff rates would be defined by a statutory order from the Minister of Economy, Industry and Employment for each technology. All renewable energy sources were covered, i.e. onshore and offshore wind energy, solar energy, hydroelectricity and biomass. A technology-specific approach was introduced (Jacobs 2012: 106). The first multi-year investment plan (PPI) was issued in 2002, including targets for most RES technologies for the year 2007 (Jacobs 2012: 58). At the EU level the first renewables directive was adopted in 2001, i.e. the Directive on Electricity Production from Renewable Energy Sources (COM 2001/77/EC). The Directive included indicative, non-binding targets for the member states, both collectively and individually. The overall indicative targets were a 12% share of gross renewable domestic energy consumption by 2010 and in particular a 22.1% share of electricity out of the total
9 See Art. L.132 of the Energy Code.
10 Art. 10, Law No.2000-108 of 10 February 2000 on the modernisation and development of the publis service for electricity.
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electricity consumption. The 2010 target for France was 21% (in relation to the 15% level back in 1997). It also required member states to issue guarantees of origin – a statement declaring whether the electricity was from renewable sources (Boasson and Wettestad 2013). The government then initiated a comprehensive reflection on the energy policy of the country in 2003, under the name of National Debate on the Energy Perspectives for France (Débat National sur les Energies).11 The result was the adoption of a new legal framework for energy policy, the so-called POPE Law of 13 July 2005 fixing energy policy orientations (JORF of 14.07.2005). This new legislative framework was based on four objectives: contribute to the energy independency and ensure security of energy supply; ensure a competitive price for energy; protect human health and the environment by controlling climate change; and guaranty social and territorial cohesion.12 Under the POPE Law, nuclear energy remained a full part of the new energy strategy. The support scheme for renewables was then further refined. Law No.2003-8 of 3 January 2003 established the contribution to the public service of electricity (contribution au service public de l’électricité, CSPE) which would compensate financially the operators who bear the costs of, notably, RES support measures. This contribution was ultimately to be paid by the electricity consumers. Another source of inspiration for climate and energy policy at that time was the so- called "factor four"-scenario. The scenario is based on the report to the Club of Rome: “Factor Four: Doubling Wealth, Halving Resource Use. A New Report to the Club of Rome” by Ernst Ulrich von Weizsäcker.13 The scenario was an official part of the Government's climate policy in 2003.14 In 2004, France adopted a Climate Plan. This Plan reviewed the various measures that the French government had taken to meet the targets of the Kyoto Protocol. The Plan included some 60 measures intended to achieve or exceed France's Kyoto protocol commitment to stabilise greenhouse gas emissions at 1990 levels by 2008-12. Proposals in the plan include a
CO2-related labelling system for cars, and other energy efficiency labels for air-conditioners, windows, hot-water systems and insulating material. France was to achieve 5.76% penetration of biofuels in transport by 2010, or five times the usage in 2004.
11 < http://www.debat-energie.gouv.fr> 12 Article 1, POPE Law. 13 14 Sandrine Mathy, Meike Fink et Ruben Bibas, « Quel rôle pour les scénarios Facteur 4 dans la construction de la décision publique ?, », Revue Développement Durable et Territoires, Vol. 2, No1, March 2011. https://developpementdurable.revues.org/8802 9
This indicates that the development of the French national and renewable energy policy was at that time to some degree placed within an international and European context. However, as witnessed in the formulation of the POPE law objectives, national priorities were dominant, not least the enhancement of energy security and independence.
3.3. Phase 3: 2005-2009: Privatization, new EU directives and increased RES ambitions The measures in the Climate Plan were then further bolstered by the adoption of Law No.2005-781. Furthermore, the mentioned "factor four"-scenario was enshrined in the law in 2005 (Loi de programme fixant les orientations de la politique énergétique, so-called POPE Law of 13 July 2005), then repeated in other sector-specific legislations. The "factor four"- scenario is still guiding the action of the French government in the area. The second multi- year investment plan was issued in 2006, including more precise and ambitious targets (Jacobs 2012: 58). Further privatization of the sector occurred in this period. By Law of 7 December 2006, the shareholding of EDF was opened up, although at least 70 has to be held by the State. As a public limited company, EDF is under the control of Auditors (Commissaires aux comptes) and the Financial Market Authority (AMF – Autorite des marches financiers), but remains subject to the State’s supervision, the Court of Auditors and parliamentary controls. (Lauriol, 2015). Several potentially relevant organizational changes took place in this phase. The well- established French Petroleum Institute (Institut Francais du Petrole, IFP; created on 13 June 1944), became in 2005 the Institute for oil and new energy (Institut Francais du Petrole Energies Nouvelles – IFPEN). The main purpose of IFPEN is to carry out research in scientific and technical fields. The State’s control over the IFPEN is significant. Furthermore, within the CRE, a new institution was created in 2006, namely the National Energy Ombudsman (by Law of 7 December 2006). It is an independent administrative authority. appointed by the Minister of Energy and the Minister of Consumption As to policy development, the Finance Act 2005 created the Tax Credit for promoting sustainable development and energy savings. As noted, the indicative French target under the 2001 Directive was 21%. This would mean that France had to produce 106 TWh of renewable energy in 2010. In 2006 it only produced 71 TWh. In 2007/2008 the energy mix was then as follows: nuclear energy 39%; oil 34%; natural gas 15%; coal 5%; hydroelectric 3%; other renewables 4 %. Nuclear stood for 79% of electricity production (Meritier 2011). As to renewable energy consumption, the picture was like this: biomass 58%; hydroelectricity
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28%; waste 6%; wind and phovoltaic 1%; heat pumps 2%; biogas 1%; biofuel 3%; and other 1% (ibid.). Generally, this period in time was characterized by a marked upward swing in the European public opinion’s concern about climate change. Back in 2003, 39 per cent of respondents to a Eurobarometer survey had cited climate change as their main worry: this figure rose to 45 per cent in 2005 and to 57 per cent by 2007. At the EU level, the 20/20/20 by 2020 targets were adopted in string 2007, followed by the elaboration of a climate and energy policy package (Boasson and Wettestad 2013). In France, there was an election in spring 2007. Although Segolene Royal emphasized the development of renewables more than Nicolas Sakozy in the election campaign, Sarkozy won the election and was the one who announced a more ambitious French RES policy in January 2008. The announced target was to increase the renewable share of energy consumption from the 6.7% level in 2004 to 20% by 2020 (Renewable Energy World 2008). This included substantial increases in wind power (from 810 MW in 2006 to 25,000 MW in 2020) and solar (from 32,7 MW in 2006 to 3000 MW in 2020). This policy was based on a ‘Grenelle process’, a three month consultation process on sustainable development initiated by Sarkozy in the summer of 2007, including the government, local authorities, trade unions, business and environmental groups.15 Six working groups were established, one of them on climate change and energy. France also held the EU Presidency in the crucial autumn of 2008 and the finalization of the EU climate and energy policy package. This package included a new renewables directive (RES-Directive 2009/28/EC,). In this Directive, the targeted overall share of renewable energy consumption in France by 2020 was to be 23%. More specifically, renewable energy was to provide 33% of the energy used in the heating and cooling sector, 27% of the electricity sector and 10.5% in the transport sector. This would mean an increase of 38% compared to the goal set by the 2001 RES-Directive.16 The new French policy was then codified in law by Grenelle Law I (Law of 23 July 2009, providing environmental objectives for reducing energy consumption. Grenelle Law 2 (Law of 12 July 2010)17 put in place a more detailed action to implement the objectives of Grenelle Law I. Furthermore, the 2009 Multi-annual Investment Plan (PPI) 2009 was adopted
15 The first such consultation process was held in the Rue de Grenelle in 1968. 16 See National action plan for the promotion of renewable energies 2009-2020 (In accordance with Article 4 of European Union Directive 2009/28/EC). 17 Law No.2010-788 of 12 July 2010 regarding the national commitment to the environment, so-called Grenelle 2 Law. 11
by Order of 15 December 2009. It defined the national objectives of the energy policy toward 2020.18 If the objectives were not reached, the government could launch call for tenders. This would apply to the share of renewable energy sources in electricity generation. To reach those objectives, the government could use two main tools: the purchase obligation and the call for tenders. At this point in time the financial crisis had set in in Europe, lowering production and contributing to rising unemployment, gradually putting increasing pressure on the EU’s newly adopted climate and energy policy.
3.4. Phase 4: 2010-2015: consolidated ambitions, feed-in adjustments and new mechanisms This phase starts with the entry into force and implementation of the provisions of the Grenelle Law 2 of 12 July 2010. The law contained several provisions of relevance for the deployment of renewable energies in France. The implementation of the Grenelle Law 2 also required the adoption of several implementation measures (decrees, circulars) providing for the details of the new support measures such as purchase obligations. In parallel, and pursuant to the RES Directive, France submitted its renewable energy action plan to the European Commission on 25 August 2010. “The plan proposed, among others, a simplification of the administrative procedures for small renewable electricity or heating production and better environmental considerations for large projects (photovoltaic, wind power, biomass), and the introduction of financial support measures such as a sustainable development income tax credit, a reduced VAT rate for renewable energy production equipment in the existing residential sector, and specific tariffs for the purchase of electricity produced from renewable energy sources.” The RES Directive was implemented in French law by Order No. 2011-1105 of 14 September 2011. 19 In the period 2008-10 PV development was reported as ‘large’ in France, leading to cuts in solar feed-in tariffs in 2010. In 2011, the Court of Audit published a report assessing the budgetary and fiscal consequences of the Grenelle Laws. In general, the Court criticized the lack of consistency and ambition of the government’s policy, besides the adoption of the new legislation.20 However, in the field of renewable energies, the Court notes that the sector had developed ‘very quickly’ since 2007.
18 Arrêté du 15 decembre 2009 19 Order no. 0215 of 16 September 2011 20 Court of Audit, Synthèse du référé de la Cour des Comptes : L'impact budgétaire et fiscal du Grenelle de l'environnement, January 2012. 12
In the industrial energy landscape, EDF was still the dominant actor on the electricity market, but new renewable energy actors were appearing at the generation level. In addition to electricity generation, EDF is also responsible for more than 95% of the electricity distribution in France.21 An interesting organizational change was the creation of the Ministry of Ecology and Energy, merging the environmental and energy portfolios. Decree No.2012-772 of 24 May 2012 provides that there is now one Minister in charge of Ecology, Sustainable Development and Energy. The Decree defines the tasks of the minister. The different tasks are carried out by several governmental services: the General Secretariat, the Sustainable Development Commission, the General Directorate for Energy and Climate (DGEC) and the General Directorate for the prevention of risks. 2012 was then a year which made clear many concerns related to the development of the French (and European) energy system and electricity market. Between 2000 and 2007, the electricity demand in Europe increased by 50 TWh per year. To fill that demand, new generation capacity, based on thermal energy, was commissioned based on the prospects that energy demand will continue to growth. However, the latter did not happen since the 2008 crisis resulted in a reduced economic activity and economic growth. Consequently, between 2008 and 2012, electricity demand dropped in Europe and there was an overcapacity of thermal energy generation (mainly, combined gas cycle power plants). In spring 2012 there was a new election and Francois Hollande from the Socialist party won the election. He had promised to reduce the share of nuclear power in the energy mix down to 50% by 2025. Subsequently, a new round of debate and consultations on energy policy and the energy transition was started in the autumn of 2012, called the National Energy Debate. This was to go on for six months, resulting in a new energy transition law. The context for this was a crisis-hit renewables sector (claimed to employ 100,000 people), experiencing soaring unemployment (Reuters 2012 a, b). At this point in time it was also announced that France was about to introduce a capacity market mechanism (Reuters Nov.14 2012). Between November 2012 and November 2013, the renewable energy production grew by more than 33%. [Detail, source]..However, this rapid increase in RES-E generation capacity, added to other factors, affected the good functioning of the electricity market and of the physical electric system. In the years 2012-2013, a reflection started as to the place of
21 Add source. 13
renewable energy sources in the national energy mix, the type of support that should be applied to those energy sources and the manner the energy system and electricity market may be affected. In addition to that situation of overcapacity, the new generation capacity based on renewable energy sources was added as a result of the support policies adopted in Europe and implemented by the Member States. The combination of those factors, together with low CO2 and coal prices, resulted in the progressive depreciation of the wholesale electricity price. (Ministry of Ecology, SD and Energy 2014). On this background, the government decided to launch a consultation in the autumn 2013 on the future of the RES support schemes in France. This consultation attracted a huge interest in the sector, with more than 100 responses received from the different actors of the sector. A survey conducted by the nuclear industry in the spring of 2013 showed 14% clear opposition to nuclear energy, 34% were ‘hesitant/undecided’, and 36% expressed a positive attitude. The industry claimed that opposition had decreased compared to right after the Fukushima accident (World Nuclear News 2013). As to labour unions media reported that one of the two main unions – the CFDT – was now calling for an energy transition to renewables, while the CGT still embraced nuclear power (Energy Transition July 9 2013). The outcome of the energy debate and a draft new energy policy and law was then put forward by energy minister Royal in June 2014. She announced that the country’s nuclear capacity would be capped at the current level and, as announced earlier, reduced down to 50% by 2025. Furthermore, GHG emissions should be down 40% by 2030, and by that time, renewable energy sources should account for 40% of electricity consumption and 32% of total energy use (Energy Transition June 18 2014). Debate on the bill started in the lower house of Parliament – the National Assembly – in October 2014. After ‘150 hours of parliamentary debate’, the legislation – the Energy Transirion Law for Green Growth - was then adopted in July 2015. A hard fight was reported by National assembly and the Senate was reported, with the NA coming out victorious (Energy Transition July 23, 29 2015) In order to achieve the targets defined by this law, support measures will still be needed, including economic instruments. Based on the consultations conducted in 2013 and recommendations from the European Commission, the French authorities redesigned their support scheme, moving towards a feed-in premium system; these changes announced in June 2016 (Energy Transition June2016). It should also be noted that although the renewables
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target binds the State at the national level, the implementation of the objectives is delegated to the local level, with a strong involvement of local authorities. The revision of the RES support system in France should be seen in the context of the adoption of the state aid guidelines, i.e. the EEAG. The adoption of the new regime was justified in the same manner than the new state guidelines was: ensure a better integration of renewables into the market. A major shift is the exposure to market prices through the direct marketing of electricity (previously sold to EDF through a purchase obligation). This corresponds to the introduction of the remuneration complement as the new main support scheme. In parallel, a system of call for tenders is introduced. Both systems are in line with the EEAG. Furthermore, a capacity market mechanism was introduced in the winter 2016-2017. The legislative basis for this mechanism was challenged before national and EU courts, although the procedures are now closed.22 The mechanism has been scrutinized by the European Commission, Directorate General for Competition (DG COMP), both as part of the sector inquiry23 and two individual cases.24 The Commission services raised some questions as to its compatibility with state aid rules, and in particular the EEAG Guidelines. After the adoption of some amendments, the French capacity market mechanism was finally deemed compatible with EU rules and so authorized by the Commission. In June 2017 Emmanuel Macron was elected president. This has been interpreted as pointing towards a basic continuation of the energy policy adopted in 2015, although Macron has been characterized as being relatively pro-nuclear. The Ministry of Energy and the Environment has now been renamed the Ministry of Ecology and Solidarity, headed by Nicolas Hugot from the ‘green camp’ (Energy Transition May 22 June 12 2017).
4. Discussion: French renewables policy and the role of the three fields
Summing up the previous section has documented a ‘nuclear France’ increasingly going renewable. A central development occurred in 2007/2008 2009, when France launched and subsequently took on the binding target of achieving a 23% renewables share of energy
22 Add reference to procedures before the Council of State (2 procedures): Association nationale des opérateurs détaillants en énergie (ANODE). Court of Justice of the European Union, Case C-543/13 23 Procedure launched in April 2015 under the state aid rules. Interim report published in April 2016. Final report expected by the end of 2016. 24 State aid case SA.39621 - Country wide capacity mechanism, and state aid case SA.40454 - Tender to support gas-fired power plant in Brittany (CCGT).
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consumption by 2020, in EU Directive 2009/28. Up to then French RES progress had been slow and mostly consisted of biomass and hydroelectric power. However a feed-in system had been introduced already in 2000. An inclusive national energy transition debate then took place between 2012-2014/15, resulting among other things in an ambition to reduce the nuclear share from 75% down to 50% by 2025, implying a need for further ramping up renewables. As part of the EU setting climate policy targets for 2030 France adopted a target of 32% renewables in the final energy consumption by 2030. In 2015/16 a capacity market mechanism was introduced and the feed-in system adjusted, but not abolished. Let us then more systematically scrutinize the three core explanatory perspectives and related propositions launched in section two. First, zooming in on the political field, we launched the following proposition: Increased weight given to renewables in the political parties and increased politicization of the RES issue have led to more weight given to renewables in French climate and energy policy. First, we can note that broad and inclusive debates on energy policy have been organized in several rounds, both in 2003/2004, 2007 and 2012-2014/2015. Still, the RES issue does not appear to have been very politicized, although some heated debates on the energy transition can be noted in the Parliament in the recent years. We are still working on the clarification of the specific RES discussions within the broader energy transition debates. The renewables issue appears very much as an overall rather low-key, technical issue, with key ministries (cf. Ministry of Ecology, Sustainable Development and Energy) and agencies (cf. ADEME) having steered this process. : As indicated, high acceptance of nuclear energy has been a quite stable feature and a related limited controversy around renewable energy issues can be noted. This goes for both the political parties and the public at large. Tellingly, in the wake of Fukushima, support for nuclear actually increased. However, a changed perception among political leaders on the sustainability of an energy model dominated by nuclear seems to have taken place. As to presidents this change was started by Sarkozy, strengthened by Hollande, and now consolidated by Macron. Hence, our tentative conclusion is that relevant changes in the political field can be noted (and seemingly more related to the energy transition at large than the RES issue per se). Still, these changes seem to have been less striking as a social driver than in other countries such as Germany. Turning then to the organizational field, we launched the following proposition: Changed industrial dynamics and an organizational landscape with growing power of ‘renewable actors’ have led to more weight given to renewables in French climate and energy policy. To what extent and how can changes in the character of the French organizational field
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of energy shed light on the development of renewables policy? One could expect the French policy to be modelled on the institutional logic that dominated within the organizational field, and we expected the field to be particularly powerful if it has been dominated by one institutional logic and when the structural power (information and formal authority) is concentrated. Given the historical dominance of EDF in France and the slow pace of energy market liberalization in France, our impression is that the organizational field in France has been powerful and that the French schemes have been modelled on a technology development logic, rather than a market logic. This goes for the whole period up to 2010. After 2010, the EU has arguably ensured more market thinking in the design of RES policy. As to changes within the field, the industrial picture has been marked by a dominance of a few large industrial players, with EDF as the central one and key nuclear operator. However, also EDF is exposed to changes in energy markets sweeping across Europe, with renewables coming on strong in neighbouring Germany and the UK (where EDF also has a strong position). EDF is now communicating support to an energy transition with increased weight to renewables. Has there been any development over time when it comes to the formal decision making powers in these issue areas? As noted, several organizational changes have taken place. A trend over time seems to be a gradual merging of the environmental and energy portfolios. We are currently exploring to what extent and how these organizational changes have influenced the development of renewables policy. However, as to the positions of key organizational actors we have noticed vocal support to renewables in agencies such as ADEME, possibly increasing over time. Finally, there is the interaction with the European environment, and both the possible influence of various EU policies, and possible learning from RES policy frontrunners such as Germany and the UK. As RES feed-in systems are subsidy systems the relationship also to developing EU state aid policies needs to be scrutinized. We formulated the following proposition: Changing EU policy and/or learning from the experiences of European RES frontrunners have led to more weight given to renewables in French climate and energy policy. Our expectation for all countries was to be increasingly influenced by the EU over time, as the EU has gained increasing competence in this issue area and we have seen institutionalization around a specific way to design support schemes in EU and EEA countries. Furthermore, we expected EU influence to primarily result from national actors that
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learnt from and were inspired by political processes and discussions at the EU level or developments in other EU or EEA countries. As noted, France first introduced a feed-in scheme back in 2000. Did France then adopt this feed-in scheme in 2000 because it was influenced by policies of RES frontrunners such as Germany? We need to explore this in interviews ahead. But the tentative impression is that the adoption of such a scheme was first and foremost a response to domestic concerns, mainly a further bolstering of national energy supply security. In other words, to complement the dominant nuclear energy programme pursued by the French government. Generally, at this point in time France seemed to give more attention to the Kyoto Protocol and the subsequent French target taken on in the EU BSA than to other relevant EU policy. Still, the link between the international processes and the specific adoption and design of the feed-in scheme seems not very strong. However, over time, it seems clear that adjustments in the feed-in system have been influenced by developing EU state aid policy. Which main French actors interpreted and ‘transmitted’ the key policy signals from the EU in this issue area? The most obvious candidates here are the main directorate in this issue area (i.e. ADEME) and the Ministry of Ecology and Energy (named so in 2012). But there are also other relevant actors in the renewables organizational landscape, including the energy regulatory authority (i.e. CRE). The more specific distributions of power and effects on renewables policy need to be further explored in interviews. An interesting question is also the introduction of a capacity market mechanism. Here it is reasonable to assume learning and policy diffusion taking place between France and neighboring countries; however, these processes also clearly influenced by the EU. Winding up: why has ‘nuclear France’ gone renewable? Our tentative answer – to be further challenged and refined through interviews - is that the key to understand this can be found in changes both in the political and organizational fields. In the political field this does not refer to significant changes in Parliamentary dynamics, but rather a changed perception among political leaders on the sustainability of an energy model dominated by nuclear. As to presidents this change was started by Sarkozy, strengthened by Hollande, and now consolidated by Macron. We notice a corresponding change in the perceptions of key bureaucratic actors in the organizational field, interacting with changes within industry. These changes have probably been influenced by a more vigorous EU policy in this field from 2005 on and significant weight given to renewables in neighboring countries such as Germany and the UK. But our impression is not that the European environment is the most important driver
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of the French turn to renewables; we posit that this key driver can be found internally in France.
5. Concluding reflections
The recent years present a somewhat mixed picture. On the one hand, France is currently one of the EU’s largest producers and consumers of renewable energy, with for instance the share of installed hydropower capacity close to 20% in 2014. Turning to consumption, renewable energy sources represented 14.6% of the final energy consumption in 2014 (18.4% for electricity, 18.1% for heating and 7.7% for transport),25 and 14.9% in 2015.26 Particularly during the last few years, the renewable energy sector has witnessed high increase rates particularly in the wind sector (e.g. +29% installed wind power in 2015 compared to 2014) and solar sector, which shows the new dynamics at work. Similarly, the government has finally decided to raise its level of ambition in the offshore wind sector, with the adoption of third tendering round in 2016. Renewable energy sources are now regarded as a real option in the efforts to both reduce GHG emissions and ensure security of energy supply by reinforcing local generation.27 Furthermore, as noted above, the 2030 target of 32% basically means a doubling compared to present levels, Compared with RES frontrunner Germany France have more ambitious targets as to the RES share in final energy consumption both for 2020 (FR: 23%; Ger: 18%) and 2030 (FR: 32%; Ger: 30%). On the other hand: although the share of renewables in the French power mix has increased after 2010 (by around five percent), this is much more moderate than the development in neighboring Germany and the UK (14% and 17% growth respectively) (Sandbag 2017: 17). Furthermore, there is still some way to go to compliance with the 23% 2020 target.
25 In 2014, France had 21 002 thousands toe or primary production of renewable energy from renewable sources. According to technology, the share was: (2.9% solar energy, 63.1% biomass and waste, 1% geothermal, 25.7% hydropower, 7.1% wind energy (Eurostat 2016) 26 La directive 2009/28/CE, relative à la promotion des énergies renouvelables, fixe à la France un objectif de 23 %d’énergieproduiteàpartirdesourcesrenouvelablesdanslaconsommationfinalebruted’énergieàl’horizon 2020.En2015,cetteparts’élève à 14,9 % ; elle reste inférieure aux 17 % prévus par la trajectoire définie par la Francepouratteindrel’objectif2020.Cettetrajectoireestprésentéedansleplannationald’actionenfaveur des énergies renouvelables (PNA EnR). Source : Chiffres clés de l’énergie, 2016. (February 2017) http://www.statistiques.developpement-durable.gouv.fr/fileadmin/user_upload/Datalab-13-CC-de_l-energie- edition-2016-fevrier2017.pdf 27 Lafactureénergétiques’élevaità56MdEURen2014) 19
Overall, the French renewable energy sector is facing a series of intrinsic challenges. The increase in RES new generation capacity varies greatly according to the technology. Solar PV has performed well, while other technologies are struggling. Both onshore and offshore wind are facing local opposition resulting in court proceedings delaying project completion. Wind power development has been identified as one of the key challenges ahead (Deloitte 2015) In addition, most renewable energy sources remain relatively more expensive than conventional energy sources in France, with a huge variation among the different sources of renewable energy.28 Consequently, the costs of reducing GHG emissions have varied greatly and are expected to continue varying greatly depending on the type of renewable energy source.29 The effects of a higher exposure to market signals are also not yet known. It could for example lead to a consolidation of the market, with the disappearance of some small actors, local projects and the concentration of the market between a smaller number of bigger actors (Matthieu and Rüdinger, 2016).
References (incomplete!) Banet, Catherine (2014). Die Energiewende made in France: la transition énergétique, in Klimapolitikk i krysspress,. Energi og Klima : Norsk klimastiftelses nettmagasin., Report 3/2014, pp. 41-43. http://energiogklima.no/blogg/banet/die-energiewende-made-in-france-la-transition- energetique/ Banet C., 2017 (forthcoming), Energy Law in France, Monograph, International Encyclopedia of Law, Kluwer Law International. Banet C., 2016, Capacity markets and the internal market: the French court case (C-543/15 ) A missed opportunity?, UiO/UiO-energi/Energi Norge seminar 26. april 2016, Oslo – article version to come Boasson, E.L. 2013. National Climate Policy Ambitiousness: A Comparative Study of Denmark, France, Germany, Norway, Sweden and the UK, CICERO Report 2013:02.Grenelle de l’Environnement, Comité Opérationnel 10 (COMOP 10), « Plan de développement des énergies renouvelables à haute qualité environnementale 2008-2012-2020 »
28 See if figures available on EurObserver. 29 For the purpose of electricity generation, and besides hydropower, onshore wind is deemed to be the most cots-effective renewable energy technology. See Lettre Trésor-Eco, Les énergies renouvelables: quells enjeux de politique publique, Ministry of the Economy and Finance, No 162, March 2016. 20
ENDS Europe. 2016. France bolsters renewables sector with new premium, June 6 2016. Gouvernement francais (2014), Réponse des autorités francaises a la consultation de la Commission sur le projet de lignes directrices concernant les aides dans le domaine de l’environnement et de l’energie Gouvernement francais (2015), Rapports sur les moyens consacrés à la politique énergétique, Annexe au rpojet de la loi de finances pour 2016 Gouvernement francais (2016), Rapport du Gouvernement au Parlement sur le financement de la transition énergétique International Energy Agency : - Energy Policies of IEA Countries – France, 2016 Review (IEA, 2017) - Energy Policies of IEA Countries – France, 2009 Review (IEA, 2010) Jacobs, D. 2012. Renewable Energy Policy Convergence in the EU: The Evolution of Feed-In Tariffs in Germany, Spain and France, Farnham: Ashgate. Le Monde, 2 fev 2015, Energies renouvelables : la France peut-elle rattraper son retard ?.) Lauriol T. 2016, Energy law in France, in Energy law in Europe, Oxford University Press, 2016, chapter 7. Mathieu M., Rüdinger A., Evolution des mécanismes de soutien aux énergies renouvelables électriques en France : comment concilier les enjeux d’intégration et de déploiment ?, IDDRI, Working Paper No.02/January 2016 Meritier, S. 2011. French Energy Policy within the EU Framework: From Black Sheep to Model?, in Birchfield, V.L. and J.S. Duffield, eds., Toward A Common European Union Energy Policy, New York: Palgrave, pp. 145-169. Ministry of Ecology, Sustainable Development and Energy, Direction générale de l’énergie et du climate, Evolution des mécanismes de soutien aux installations sous obligation d’achat – Restitution de la consultation nationale, December 2014 Ministry of Ecology, Sustainable Development and Energy, Conjoncture énergétique Décembre 2015, Commissariat Général au Développement Durable, no 728, February 2016 Ministry of the Economy and Finance, Lettre Trésor-Eco, Les énergies renouvelables: quells enjeux de politique publique, No 162, March 2016 Szarka, J. 2011. France’s troubled bids to climate leadership, in Wurzel, R.K.W. and J.Connelly, The European Union as a Leader in International Climate Change Politics, London: Routledge, p.p.112-129.
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