Rising opportunities for agrivoltaic energy projects under France’s regulatory strategy

Driven by the will to be at the forefront of the energy transition while securing its agricultural economy, France has embraced ‘agrivoltaism’ - the practice of using land for both solar energy and agriculture – by introducing a new law, known as Act APER, in March 2023 that recognises agrivoltaism as part of the national renewable strategy.

Under the legal framework, large-scale solar panels built over crops on agricultural lands have become a key part of France’s efforts to reach its target of 100 gigawatts of solar energy by 2050, alongside ground-mounted and rooftop solar projects.

With market turnover of nearly €109 million and several projects in development, the new regime can open the way to multiple growth opportunities for the solar power sector. The innovative legal framework is essential for the development of agrivoltaic projects and will play a crucial role in achieving the French government's goals of 40% renewable energy in its energy mix by 2030.

The regime is also expected to boost electricity production through solar power, as France has set a goal to reach between 35.1 GW and 44 GW by 2028, with the industry hoping for an increase of these targets in the upcoming Pluriannual Energy Program. At the end of the first quarter of 2023, only 19 GW of solar photovoltaic (PV) installations were installed in France, meaning there is room for improvement. Since the legal regime was introduced, there have been encouraging results. In 2023, solar power electricity production reached 22.7 GW, marking a significant increase of 19.2% compared with the same period in 2022.

On 8 April, the French government enacted an important decree to clarify the legal framework and criteria applicable to agrivoltaism, following a public consultation conducted between 26 December 2023 and 16 January 2024. The consultation gathered 571 responses, showing the high public interest in this decree. Businesses seeking opportunities in the solar power sector in France should understand the main provisions, requirements and measures of the pioneering regulatory regime.

Legal definition of ‘agrivoltaism’

It is crucial to first understand the legal definition of agrivoltaism under the regime and how it differs from other PV plants on agricultural plots.

Until the 2023 legislation was introduced, ground-mounted solar installations located on agricultural plots used to be authorised by way of derogation, as collective equipment, as long as they were “not incompatible with an agricultural activity operated on the same site”. With the new Act, notably article 54, the distinction has become clear between agrivoltaism, PV deemed “compatible” with agricultural use and a residual category of “other” PV plants on agricultural plots.

For a solar project to qualify as agrivoltaism, it must be located on agricultural land and, more importantly, must significantly contribute to installing, maintaining or developing agricultural production. The underlying rationale behind this requirement is to create synergies between electricity production and agricultural production.

The category of PV deemed compatible with agriculture is defined as solar panel plants that do not meet the agrivoltaism definition criteria but are nonetheless located on agricultural plots. These are listed in a framework document setting out 14 different zones, including plots that have not been operated for a minimum period of ten years like former mines, and former hazardous storage facilities. These second category projects are freely designed, as opposed to agrivoltaism, but their potential locations are restricted to the framework document which reflects France’s intention to repurpose unused land and integrate this into the energy transition plan.

A third category created by Act APER covers PV plants that do not fall under the agrivoltaism criteria or are located in the area covered by a framework document for compatible PV, but have obtained ad hoc consent from the Departmental Commission for the Protection of Natural, Agricultural and Forest Areas (CDPENAF).

Conditions for agrivoltaic projects

The aim of the agrivoltaism legal regime is to preserve farmers’ activities and prevent a change in the use of agricultural land while favouring the development of solar energy. Project developers and holders have a duty to improve agronomic potential and provide protection against climate hazards. More specifically, the Act APER and the Decree outline four conditions that agrivoltaic projects must satisfy to be classified as such.

The PV plant must ensure a significant level of agricultural production and provide a sustainable income to the farmer

This requirement is designed to protect the agricultural destination of plots hosting PV plants, and to enable farmers to benefit from the income generated by this electricity production.

The sustainable income criteria set out in the Decree requires that the average income from the sale of the farm’s crop and livestock products is not affected by the installation of the PV plant. This means the farmer’s average income after the installation of the PV plant should not be lower than the average income before the installation. This will be calculated over the first five years of the agrivoltaic installation’s existence, as compared to the farmer’s average income over the previous five years.

The Decree specifies that the criteria of significant agricultural production is assessed on a case-by-case basis, taking into consideration of a list of agrivoltaic technologies compatible with each geographical area and farming method. These measures will be set out in an upcoming Ministerial Order. If the plant is not compatible with the order, a ‘control zone’ of at least 5% of the “installed agricultural surface”, within a limit of one hectare, will be established to demonstrate its benefit. It is possible to deviate from this rule in cases where the installation of this control zone is technically impossible. However, this exemption is only possible for agrivoltaic installations with a coverage rate of less than 40%, meaning the agrivoltaic installation covers only 40% of the total agricultural land.

Agricultural operation should be the primary activity on the plot, emphasising the integration of agriculture as a core element of the installation

The Decree provides that the portion of land that can no longer be farmed due to the installation of the agrivoltaics - to the exclusion of any agrivoltaics technical structures situated outside the plot - must not exceed 10% of the total surface area occupied by the agrivoltaics installation. This provision is designed to ensure that agriculture remains the primary activity on the plot.

The activity must be reversible

Rehabilitation of the site once the plant is commissioned must be proactively planned for, with the aim of minimising permanent impacts on the agricultural environment.

Under the regulatory framework, local authorities may require that financial decommissioning guarantees are in place as a prerequisite to authorisation. These guarantees aim to cover dismantling of the agrivoltaic facilities at the end of the plant’s lifecycle.

The Ministerial Order sets the level of the financial guarantees at €1,000 per MWp installed for plants under 10 MWp in capacity, and €10,000 per MWp for plants exceeding this threshold.

The installation must provide at least one of the following four services to the plot

• enhancing agronomic potential, either by improving the soil’s agricultural specifications to increase crop yields, or maintaining current yields or compensating for any observed local decline;
• favouring adaptation to climate change, based on an assessment of three types of impacts: thermal (regulating temperature during extreme weather), hydrological (managing water stress, improving water use, and enhancing water comfort), and radiative (shielding against excessive radiation to prevent foliar burns);
• providing protection against hazards; or
• ensuring animal welfare, either by bringing down the temperature in areas accessible to animals sheltered by PV modules or by providing services or structures that enhance animals’ living conditions.

The clarifications provided by the Decree highlight the French government’s commitment to developing solar-generated electricity while safeguarding agricultural production. Where developers meet the criteria set out in the regulatory framework, their installations will not only harness solar energy but also contribute positively to agriculture, sustainability and environmental resilience.

Common provisions for agrivoltaics and agriculture-compatible PV projects

Certain provisions of the Decree apply to both categories of solar panel installations.

Firstly, the Act APER provides a maximum operational period of 40 years for both types of projects. This period can be extended for two additional years, renewable up to five times, for a potential total of up to 50 years, showing the Act APER and Decree’s commitment to supporting long-term renewable energy production. This provides comfort to developers, particularly if they undergo challenges or difficulties in reaching the expected return on investment, and will benefit those who wish to extend the lifespan of their projects.

Secondly, both types of projects require drafting of two reports: one before commissioning and another during the sixth year of operation for “compatible” PV installations, or after five years for agrivoltaics.

For agrivoltaics, conditions are assessed both before and five years after their initial installation. The operator of the installation must submit an expert report to the relevant authority, such as the Préfecture, to ensure continued compliance with the established conditions. All agrivoltaic installations will undergo follow-up checks starting from five years after commissioning. Subsequent checks occur every five years for installations specified in the Ministerial Order, every three years for others, and annually for those with a coverage rate below 40%. If conditions are not met, the authority may order the dismantling of the installation. This underscores the essential criteria of dismantling for an agrivoltaic project.

For PV installations compatible with agriculture, a pre-commissioning report is required to ensure that the technical aspects of the installation do not permanently disrupt the ecological functions of the soil and align with agricultural, pastoral and forestry activities, as well as reversibility. Subsequently, during the sixth year of operation, another report should be issued to certify that the soil’s ecological functions - such as biological, hydrological and climate aspects - remain unaffected. Additionally, it confirms that there is no incompatibility with agricultural, pastoral or forestry practices on the land.

Economic incentives for agrivoltaism

The solar power industry faces various challenges in terms of subsidies. With the enforcement of Act APER, two measures were introduced to address some of the challenges. First, the Act provides legal confirmation that agrivoltaism is compatible with receiving subsidies from the EU under the Common Agricultural Policy (CAP). Second, it allows the government to conduct calls for tenders for agrivoltaic projects.

These incentives will play a crucial role in achieving France’s ambitious renewable energy goals and reaching the target of 100 gigawatts of solar energy by 2050. However, several lessons can already be drawn from the Decree, which enters into force more than a year after the Act APER. There are already disparities in the legal framework related to PV development. The Decree did not contain any transitional provisions on the distinction between agrivoltaism and compatible PV installations, and the many projects developed prior to the Decree’s enforcement were done under a framework that did not have specific criteria. Until recently, developers had used the term “agrivoltaics” to refer to what would now be classed as compatible PV installations – although they are not necessarily located within the framework document specifying the designated zones. As a result, the immediate enforcement of the Decree upon its publication could temporarily halt PV development – a considerable issue with up to 25GW of projects currently under development, including 6.2GW specifically allocated to compatible PV projects, which have already undergone review by local authorities.

Co-written by Charles Bressant and Francesca Bourrat of Pinsent Masons