French rooftop solar developer Orion Energies plans to raise fresh equity for its growth ambitions, sources familiar with the situation said, but this process – and the country’s wider solar rooftop sector – now risks being hit by the French government’s new plans to reduce tariffs for rooftop solar installations.

According to the sources, Orion recently mandated Gottengreen to advise on the process, dubbed Project Electron, with teasers distributed earlier this month. Neither Orion nor Gottengreen have responded to requests for comment.

The Paris-headquartered company aims to bring on board a financial investor to support its pipeline of greenfield solar projects, with plans to raise EUR 50m-EUR 70m of external capital. The equity is to continue its development over the next three years and build an already secured pipeline, according to the sales teaser seen by Infralogic.

Orion expects to raise EUR 100m of equity overall to finance its target to have an operating capacity of 1 GW by 2031, according to the teaser and sources.

The company, which to date has developed more than 400 MW of solar PV capacity for third parties, started to develop its own projects in 2020, with a view to becoming an IPP focused on small-scale solar PV projects, from rooftop to small ground-mounted PV, carparks and agrivoltaics projects under 1 MW.

It has since built or is building 48 MW of own installed capacity and has around 330 MW of new projects already secured across France.

It has a team of 75 people in Paris, Lyon, Toulouse and Bordeaux and a fifth office planned for this year.

In 2020, it completed an equity raise with French manager Rgreen Invest, while in 2023 French private equity firm Weinberg Capital Partners (WCP) bought a minority stake in the business, which continues to be majority owned by the company’s management team.

The formal launch of the new planned equity raise, however, has not happened yet, and sources said it might be delayed “by several weeks or even longer” due to recent government announcements that are seen as dangerous for the sector’s development.

Last week, the government launched a consultation about a draft decree which aims to modify support for solar PV projects on buildings and warehouses. The government said it wants to “revise the terms of support for the sector” and as a result, it plans to slash the feed-in tariffs (FiTs) for all rooftop PV systems with a capacity of up to 500 kW.

The Ministry of Energy said that the 100-500 kW sector has seen a “strong dynamism” in recent years and that the “support tariff will be adjusted to preserve the economic balance of the projects, while controlling public spending.”

These plans have raised concerns from industry bodies and private investors alike.

Bodies including Enerplan, the French union for the solar energy industry, and Syndicat des énergies renouvelables (SER) which regroups the wider renewable energy sector, last week voiced their concerns and asked the government to reverse its plans and maintain the current tariff framework, to ensure that investments being made in the sector continue at the current pace, or the segment risks being brought to a sudden halt.

The two bodies, which had an initial meeting with the Ministry of Energy on Wednesday, added that if maintained, the decision would “put to a sudden halt one of the most dynamic sectors of energy transition”, impacting not just future projects but also stopping current and committed projects, and affecting thousands of jobs.

From the private sector side, infra funds-backed Valorem on Wednesday expressed concern about the government’s plans, saying that “this unilateral measure directly threatens the future of the sector and compromises collective efforts for a sustainable energy transition”.

Other developers criticising the draft legislation in recent days have included French solar company See You Sun (SYS), which is backed by Demeter’s Climate Infrastructure Fund (CIF), and IPP Tenergie, among others.