Socialist French government moves to bail out its ailing solar industry

The Socialist French government is implementing measures to rescue the country’s ailing solar industry by doubling the national photovoltaic power generation target and offering more subsidies to small solar farms that use European-made panels.

“Many jobs were lost because of the [former] government’s yo-yo policies. But we will fight … to develop the ecological competitiveness of France,” Energy Minister Delphine Batho told reporters.

Reuters reports that the production capacity growth target will double to 1,000 megawatts per year. The French government will throw in a bonus of up to 10 percent for small solar farms using panels made in the European Economic Area.

The French government says the move will cost 90 and 170 million euros annually, and will be paid for by consumers through their power bills.

Jean-Louis Bal — the head of the country’s main green energy lobby, SER — said the industry will welcome the move in the short term, but the long-term viability of solar energy in France is still unclear.

France has long sought to reduce imports of the cheap Chinese-made panels that have flooded the solar panel market and sparked cries of unfair competition from domestic producers. A similar situation in the U.S. last year prompted the Obama administration to slap tariffs on Chinese-made solar panels.

In March 2012, the Obama administration hit Chinese solar cells with anti-subsidy tariffs of up to nearly 5 percent. In May, the administration imposed anti-dumping duties on the cells of up to 250 percent.

But it remains unclear whether those measures are allowed under World Trade Organization rules.

“In terms of legal risk, I don’t think there is one at the European level. But at the World Trade Organisation level, it would take years [to challenge it], so the government did well,” Bal said.

Renewable energy generation only makes up 13 percent of energy consumption in France, which is substantially below the 23 percent goal that former President Nicolas Sarkozy set for 2020.

The new emergency measures are set to take effect later this year.

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