France Business Information / Environmental Regulation
GRENELLE
In Autumn 2007, President Nicolas Sarkozy launched an unparalleled consultation process, the “Grenelle” Environment Round Table Talks based on the following four themes:
- Fighting climate change
- Protecting and managing biodiversity and natural environments
- Protecting health and the environment while promoting economic growth
- Developing an environmentally responsible democracy
Following this in-depth consultation exercise with all the relevant institutional and corporate stakeholders in sustainable development, France then drafted a comprehensive action plan embodied in two successive government acts:
- The “Grenelle I” planning Act (August 3, 2009), relative to the implementation of France’s “Green New Deal”;
- The “Grenelle II” enforcement Act, due to be passed into law after discussions and debate in the French Parliament.
GREEN NEW DEAL
The resulting “Green New Deal” seeks to maintain the same level of national wealth using four times less energy and raw materials. It is also in line with the European sustainable development strategy: the “Energy-Climate” package adopted at the end of 2008 under the French presidency of the European Union established a “20-20-20” target for the year 2020:
- a 20% reduction in greenhouse gas (GHG) emissions
- a 20% improvement in energy efficiency
- a 20% share of renewable energies in EU energy consumption.
The main projects defined by the “Grenelle” Talks (in the construction, transport, energy and waste management sectors) will give a decisive boost to sustainable economic growth: a potential €400 billion of public-private investment by 2020.
France’s attractiveness will be enhanced in the medium term, thanks to the growth in structural investments under the “Green New Deal”: infrastructure, research (creating nearly a dozen innovation clusters dedicated to ‘green’ technologies), and the development of cutting-edge industries, among other measures.
France’s commitment to “green growth” will create numerous investment opportunities for French and foreign companies:
BUILDING AND HOUSING
The Building Plan will encourage thermal renovation of existing buildings and the construction of energy-positive buildings.
Objective: To cut the energy consumption of existing buildings by at least 38% by 2020.
Measures:
- An interest-free “eco-loan” for thermal renovation of private properties. This eco-loan is not means-tested and is capped at €30,000 per residence.
- A 5.5% VAT rate on installation, maintenance and renovation work in housing.
- A “sustainable development tax credit” enabling households to deduct part of the cost of energy improvement work from their income tax bill (up to 50% for photovoltaic panels and 40% for wood-burning stoves).
- Tax credit boosted to 40% for interest payments on the purchase of “low-consumption” housing.
The “low-consumption” standard will come into effect at the end of 2010 for new public and tertiary buildings, and by 2012 for new housing. The thermal renovation of existing public buildings should be underway by 2012. The “positive energy building” standard 6 will be enforced from the end of 2020.
TRANSPORT
Objective: To cut CO2 emissions by 20% to 1990 levels by 2020.
Measures:
a) Prioritizing alternative means of transport to road and air:
- Laying 2,000km (1,250 miles) of high-speed rail lines by 2020.
- Developing the rail freight industry by constructing dedicated “rail motorways” and reopening disused lines.
- Expanding river networks, sea/road transport and port installations for freight.
- Extending “exclusive right of way” networks in urban areas.
- Multiplying the number of regional lines by six.
- Innovative solutions to finance infrastructure, such as a rebate on the carbon credit to aid the development of innovative projects.
b) Reducing private vehicle emissions from 176g of CO2/km to 120g of CO2/km by 2020:
- The introduction in 2008 of a “bonus/malus” system, making greener vehicles cheaper and more polluting vehicles more expensive.
- Government support for manufacturers developing hybrid and electric vehicles.
ENERGY SAVING AND CARBON REMOVAL
The various objectives of France’s “Green New Deal” will encourage energy savings and the diversification of the energy mix.
Objectives:
- To cut greenhouse gas emissions by a factor of 4 by 2050.
- To achieve a 23% share of renewable energies in final energy consumption by 2020 (vs. 10% at present).
- At least one photovoltaic solar power plant per region by 2011.
- The 400 hydropower concessions in France will be opened up to competition, including 20 large concessions by 2020.
- The “énergies bleues” plan: to produce 6,000 MW of ocean energy by 2020.
Measures:
- Creation of a “renewable heat fund”, amounting to almost €1 billion over three years (2009-2011).
This fund will benefit cooperative housing, communities and all companies. Its purpose is to develop the production of heat from renewable energy sources (biomass, geothermal energy, solar thermal energy, etc.). It will provide financial aid to companies and communities, ensuring that their renewable energy thermal projects are cost-effective.
- Competitive feed-in tariffs for renewable electricity.
The base tariffs for building-integrated installations (before any eligible regional bonus) vary between €0.45/kWh and €0.57/kWh. With these tariffs, France is more competitive than the three leading European markets (Germany, Italy and Spain).
- French overseas territories will begin to exploit their potential to achieve long-term full energy independence, with a goal of 50% energy independence by 2020.
Initiatives will include moves to preserve biodiversity and make much greater use of renewable energy.
- No further retail sales of incandescent light bulbs from 2010 - France is taking action ahead of EU targets.
- To make France’s energy infrastructure less carbon-intensive.
ENIVIRONMENTAL SERVICES
Waste management
Objectives:
- To prioritize reducing volumes at source (by 5kg per person per year) through measures to discourage high-waste-generating consumer products.
- To recycle 75% of household packaging by 2012 (vs. 60% in 2006) and 70% of construction waste.
- To achieve a 15% decrease in residual waste sent for incineration or landfill by 2012.
- To increase organic matter recycling from 24% at present to 35% in 2012 and 45% in 2015.
Measures:
- The introduction of waste management incentive fees within 5 years by all local authorities;
- Taxes on waste incineration and landfill.
Agriculture
Measures:
- Doubling the tax credit for organic agriculture in 2009, in addition to existing aid.
- A tax credit for energy evaluation in agriculture.
Water and sanitation
Measures:
- To ban the use of phosphates in household detergents from 2012 and in industrial detergents from 2015.
- To modernize all waste water treatment plants by 2011.
- To introduce rainwater harvesting systems into the public sewage system.
FURTHER RESOURCES
The information on this page has been supplied by Invest in France. For further information, please see: 'France welcomes Investment'.
