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FAVOURABLE WINDS
FOR FRENCH
OFFSHORE WIND
FARMS
MAY 2022
FAVOURABLE WINDS FOR FRENCH
OFFSHORE WIND FARMS
While Northern Europe and the UK started investing in offshore
wind more than 20 years ago, France was slow off the mark.
Now, that is about to change, as the development of the first
French projects gets under way.
This article was originally published in Project Finance
International Magazine.
In the past, France has struggled to However, this model has now proved
anticipate fully the specific characteristics effective. The first three French projects,
of offshore wind projects and the each providing approximately 500MW of
differences between such projects and power for a cost between €2 and €2.5
other major public tenders. As of spring billion, were thus financed through limited
2022, only one demonstration offshore recourse financing in 2019
wind turbine, accounting for 2MW, is (Saint-Nazaire), 2020 (Fécamp) and 2021
operational in France, compared with, for (Courseulles-sur-Mer), respectively.
example, 2,542 wind turbines in the UK, Saint-Nazaire is expected to be the first
accounting for 12.7GW; 1,501 wind industrial-scale French project to enter
turbines in Germany, accounting for into operation by the end of the year.
7.7GW; 599 wind turbines in the Fécamp is due to be commissioned in
Netherlands, accounting for 3GW; 631 2023, as is Saint-Brieuc, a project also
wind turbines in Denmark, accounding for providing approximately 500MW of
2.3GW; and 399 wind turbines in power. Courseulles-sur-Mer should finally
Belgium, accounting for 2.3GW – a enter production in 2024, followed by the
Deployment has taken a long performance all the more remarkable, Noirmoutier and Tréport wind farms a few
time, but this has been due, since the Belgian coast is only about years later.
approximately 65km long.
in part, to the fact that Secondly, and even more significantly,
France had to invent and Development of the first French projects after a relatively timid start when it was
build the French offshore is now well under way. Deployment has difficult to understand whether France
wind model from scratch taken a long time, but this has been due, was driven by a real conviction around
in part, to the fact that France had to offshore wind power or by the sole need
invent and build the French offshore wind to comply with renewable energy
model from scratch. France had to production quotas imposed by the
develop balanced and fundable regulated European Union, a significant change has
contract models, in an environment in taken place at the political and
which France can perhaps be singled out strategic level.
for the specific nature of its legal
framework and the number of public To highlight this change, it is enough to
parties involved. consider the number of discussions that
have recently been held by a number of
In addition to an agreement with the State public players concerning the energy mix
authorising occupation of the public (see box). France has finally convinced
maritime domain, each wind farm project itself that renewable energy has a place in
is based on a power purchase agreement the national energy mix, without the need
with EDF acting as a compulsory buyer – to pit nuclear energy and renewables
now a contract for additional against each other. Moreover, on the
remuneration, a so-called "feed-in contrary, nuclear is an easily controllable
premium contract" in more recent calls for basic energy that renewables can
tenders – and various contracts effectively supplement as part of an
concluded with RTE, the operator with energy mix promoting the decarbonisation
the legal monopoly for the electricity of electricity production.
transmission network in France, for the
connection of the wind farm to, and the
injection of electricity into, the network.
2 CLIFFORD CHANCE
FAVOURABLE WINDS FOR FRENCH OFFSHORE WIND FARMS
the now clear political will, France can
Recent public discussion papers
base its high ambitions on a number of
RTE: "Futurs énergétiques 2050 –
significant advantages. There are a
principaux résultats", October 2021
number of factors lending credibility to
French National Assembly: "Rapport this scenario.
d'information sur les freins à la Particular attention must
France has undoubted geographical
transition énergétique", June 2019
advantages, its coasts being among the also be paid to the way in
French Energy Regulatory most extensive and exposed in Europe. which the deployment of
Commission: "Study on strategic future projects will be
perspectives of energy", May 2018 The first projects have provided the
country with infrastructures and
organised by the State
ADEME: "A 100% renewable
production tools developed not only by a within the exclusive
electricity mix? Analyses and
bench of big companies active in the economic area.
optimisations", January 2016
sector in France, but also by smaller
French Economic, Social and French companies with the creation of
Environmental Council: "La "wind offshore" clusters in some regions.
transition énergétique: 2020-2050: un Following such initial projects, large
avenir à bâtir, une voie à tracer", France-based suppliers and contractors
January 2013 have also entered the market, so there is
now a comprehensive ecosystem of
In fact, such decarbonisation of electricity competent operators in all segments of
production was already the purpose of the value chain, such operators having
the new multi-year energy programme, demonstrated their ability to be
made public in April 2020, which provides competitive in this sector and several of
for an acceleration of the launch of which have pursued successful
offshore wind projects. Indeed, in international development.
2021/2022 alone, France is set to launch
no fewer than five new calls for tender – Unlike fixed wind turbines, which got off
calls for tender 4 to 8 – resulting in more to a slow start, France is leading the way
projects being initiated in two years than in terms of floating wind turbines, which
in the last ten years. are seen as an important growth driver
for the sector. Four pilot projects
Launches are also expected to continue launched by the State under the
at a sustained pace. Whereas the multi- supervision of ADEME are thus well
year energy programme suggested that placed to be among the first farms in
1,000MW of new projects would be put operation in Europe. To date, only the
to tender annually from 2024, last Portuguese Windfloat Atlantic project
February the State announced that it (25MW, 2020) and the British Kincardine
wanted to build no fewer than 50 offshore project (50MW, October 2021) have been
wind farms, bringing the national installed commissioned. The Norwegian Hywind
capacity to 40GW by 2050, which is Tampen project (88MW) should be
expected to cover 20% of France's operational by the end of 2022.
electricity consumption by then.
Floating wind turbines also play an
The new geopolitical situation following important role in the new industrial-scale
the war in Ukraine and Europe's aim to projects recently put to tender. Following
phase out Russian gas is unlikely to the launch of a first tender for a 250MW
reverse this trend. On the contrary, the wind farm in the south of Brittany in
European Commission's recent 2021, the government announced, on
REPowerEU initiative is based on an 14 March 2022, the development of two
acceleration and amplification of the floating wind farms in the Mediterranean
development of renewable energy, with a capacity of 250MW each, that may
including offshore wind power in be later supplemented by two extensions
particular. France's position is likely not to of 500MW each under separate calls
change, given the tension that now reigns for tender.
over power production. And apart from
CLIFFORD CHANCE 3
FAVOURABLE WINDS FOR FRENCH OFFSHORE WIND FARMS
Although not as technologically advanced • The State has implemented a so-called
and therefore still more costly today, "envelope permit", which makes it
floating offshore wind turbines offer possible to change the characteristics
attractive advantages compared with of projects, within certain limits, without
bottom-fixed offshore wind turbines. For the need to apply for new
example: wind farms can be located authorisations. Producers can thus
further from the shore in deeper water, delay their technological choice for as
where the wind is stronger, thus avoiding long as possible in order to benefit from
constraints linked to the characteristics of the latest technical innovations and the
the sea floor; and construction and best prices, which, in turn, allows them
assembly operations can be carried out to seek premium that is as low as
at port and are thus facilitated, even if this possible during the bidding phase.
may require modifications of
• The State has improved the grid
port infrastructures.
connection regime, charging the cost
to RTE and no longer to the
It is also hoped that the development of
producer, and improved RTE's
floating wind turbines will facilitate the
liability mechanism.
acceptance of offshore wind turbines,
thanks to a more limited impact on the • The State has reserved the possibility
marine environment, a lower visual of carrying out soil studies in the call for
impact, and decreased competition with tender phase, with the objective to
other uses, coastal fishing especially, enable bidders to formulate
thereby reducing the number of more-informed proposals and
objections and appeals liable to slow the accelerate the schedule for the
pace of the projects. deployment of projects.
In recent years, the State has carried out Other factors will, of course, be important
significant work to improve the applicable to achieve the ambitious objectives stated
legal framework and facilitate the by France, especially in a context where
implementation of projects. Notable the number of projects will multiply in
innovations include: other countries, with a corresponding risk
of increased competition in attracting
• Improved conditions for public operators and capital.
participation in projects. Since the
adoption of the Essoc Law of 10 With this in mind, it is particularly
August 2018, any consultation important that France integrates future
procedures (public debates in projects into the scope of the now proven
particular) must be organised before contractual structure it has devised and
the launch of the call for tender, which which was successfully "project"
was not the case originally. Hopefully, financed. This model is built around a
this will also contribute to greater balanced and proven allocation of risks
acceptance of offshore wind projects. from which the State should not deviate
significantly, so as not to jeopardise the
• The State has pursued reforms specific
attractivity of a still recent French scheme.
to disputes concerning offshore wind
projects in order to reconcile the right
Particular attention must also be paid to
of effective recourse with the need to
the way in which the deployment of future
deal with a particularly high volume of
projects will be organised by the State
litigation in the sector causing delays in
within the exclusive economic area. The
the project development, as
challenge will be, in particular, to ensure
demonstrated during development of
that the unilateral authorisation serving as
the first projects. Thus, after initially
a basis for the occupation of the area by
appointing the Nantes Administrative
the producer provides a sufficient level of
Court of Appeal as having primary and
comfort to the producer, hopefully
final jurisdiction for disputes related to
comparable to that offered by the
offshore wind projects, the State has
agreements for occupation of the
now devolved jurisdiction in this area to
maritime public domain concluded for the
the Council of State itself, i.e. the
first projects, which were established in
highest administrative Court.
territorial waters.
4 CLIFFORD CHANCE
FAVOURABLE WINDS FOR FRENCH OFFSHORE WIND FARMS
Optimisation of the connection system the State's responsibilities in the context
will also be very important, as it is one of of said calls for tender (prior organisation
the major interfaces of the projects. From of the tender process, completion of soil
this point of view, while the risk of delays studies, established recourse to a
in the grid connection by RTE is now well competitive dialogue phase prior to the
covered, this coverage may, in practice, submission of bids, etc.), will inevitably
lead RTE to push for the producer to lead to a significant increase in workload
freeze its technological choices as early for the competent authorities.
as possible, in order to "de-risk" the
project for RTE by giving it more time to The State must therefore equip itself with
design and roll out the connection. the necessary means to manage
effectively all the issues head on, both at
This approach makes sense from the the central level and at the decentralised
carrier's perspective. But it could prove levels in the regions. From this point of
counterproductive at project level, view, an international benchmark offers
depriving producers of the full benefit of some interesting examples, and France
the aforementioned "envelope permit" to appears to be currently understaffed
the detriment of the bid competition, thus compared to some of its
leading to an unavoidable need for European partners.
additional remuneration for the producers,
and increased costs for the State's Given the scale of the obstacles already
budget. The State will therefore have to overcome, however, none of these
ensure that it finds an effective and challenges seems insoluble. On the
sustainable solution to enable producers contrary, following the re-election of
to fully integrate the benefit of President Macron who has pledged an
technological developments, which are increase in offshore wind to 40 GW over
set to remain dynamic in this sector, the next 30 years and unless an
perhaps by allowing itself to rebalance the unfriendly majority is elected at the
connection regime to the benefit of National Assembly in June, there are even
producers, or even to consider certain good grounds to hope that most will
exceptions to the monopoly held by RTE, resolve themselves naturally, thanks to
going beyond the mandate under Article the determination that France is now
L. 342-2 of the Energy Code. showing in the sector.
This may seem anecdotal, but it will also Ultimately, no one knows whether France
be important for the State to expand its is destined to become the "Saudi Arabia
dedicated staff. The increase in the for offshore wind power", in the way that
number of projects launched, the need to Prime Minister Boris Johnson plans for
monitor simultaneously the development the United Kingdom, but it does have
of projects already awarded (including some significant advantages enabling it to
leading the authorisations application rise through the ranks and compete with
procedures) and the allocation of new the best in the class.
projects, combined with an increase in
CLIFFORD CHANCE 5
FAVOURABLE WINDS FOR FRENCH OFFSHORE WIND FARMS
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Nina Yoshida
Avocat
Paris
T: +33 1 4405 5242
E: nina.yoshida@
cliffordchance.com
6 CLIFFORD CHANCE
FAVOURABLE WINDS FOR FRENCH OFFSHORE WIND FARMS
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