YES - Mure

Last update: October 2015
Title of the measure:
FRA 7 Energy Transition Tax Credit –
Crédit d’Impôt Transition Energétique (CITE)
General description
The “Energy Transition Tax Credit” or Crédit d’Impôt Transition Energétique (CITE) in French,
replaces the “Sustainable Development Tax Credit” (CIDD) launched in 2005 (and stopped on 31st
August 2014). It supports landlords or leaseholders (main residence) who pay tax in France in
purchasing efficient materials and equipment to limit energy consumption and greenhouse gas
emissions (list of equipment and materials giving access to taxes credit, maximal amount, technical
characteristics and requested minimal performances criterion are detailed in the Code Général des
Impôts).
The last “Finance law” (loi de finances) for 2015 has extended this mechanism for expenses paid
between 1st September 2014 and 31st December 2015, and simplified its procedures by applying a tax
credit of 30 %, without income conditions and without the obligation to set up a bunch of works1 (in
the limit of €8,000 euros for a single, €16,000 for a couple and €400 in addition per dependent for a 5year period ending at the latest in December 2015).
From 1st January 2015 (and from 31st December 2015 for the French overseas departments) and for
certain equipment and materials, owners have to require to certified enterprises Reconnue Garant de
l’Environnement (RGE) to benefit from taxes credit (see décret n°2014-812 du 16 juillet 2014 sur
l’éco-conditionnalité des aides à la rénovation énergétique and arrêté du 9 octobre 2015 modifiant les
conditions d’éligibilité des aides publiques attribuées à l’occasion de travaux de rénovation énergétique
dans les logements situés en Guadeloupe, en Martinique, en Guyane, à La Réunion et à Mayotte for more
details). Refurbishment works are still eligible to this tax credit in existing buildings older than 2 years.
Nota Bene: the project of “Finance Law” for 2016 plans to extend this scheme until 31st December 2016.
Conditions to benefit from the CITE?
1. Beneficiaries have to be landlords or leaseholders (main residence);
2. Refurbishments works made from 1st January 2015 have to be made by certified enterprises
Reconnue Garant de l’Environnement (RGE);
3. Installed equipment and materials have to conform to characteristics and minimal performances
criterion given by the Code Général des Impôts.
Nota Bene: there are no more income criteria for CITE and no obligation to make a bunch of works.
Eligible works and equipments
From 1 September 2014, works and equipment that can be eligible to CIDD or CITE can be sorted in two
main categories: heat and hot water production from renewable source and thermal insulation.
Among them, there are:
1

Opaque thermal insulation (walls and roofs) ;

Glazed walls insulation ;

Protection of walls, roofs or glazed walls against sun radiation ;

Heating or domestic hot water production equipment operating with wood or biomass ;

Hot water production equipment operating with solar energy or heating pump ;
"A bunch of work" is the combination of at least two actions implemented to improve the energy
performance of a dwelling
Last update: October 2015

Condensing or micro-generation boilers, energy production boilers using renewable energy
source (heating pump, hydraulic energy or biomass, wind energy) ;

Thermal insulation of low-floor ;

Insulating shutters or front door acceding outdoor ;

Heating regulation and programming systems ;

Equipment enabling individual heating costs or hot water accounting ;

Connection to heat network ;

Electric vehicle charging station.
The list of equipment and materials giving access to this taxes credit scheme, amount, technical
characteristics and requested minimal performances criterion are detailed in the Code Général des Impôts
(article quarter 200 and article 18 bis from annex IV).
Nota Bene: Energy performance diagnostics (Diagnostics de Performance Energétique - DPE) for nonlegal mandatory cases and charging stations for electric vehicles are also eligible but photovoltaic
installations and water collectors are no more eligible to tax credit since 2014.
Specific measures for overseas departments:
New equipments are eligible to CITE for dwellings located in French overseas departments:
 Opaque and glazed walls insulation against solar radiation ;

Ventilating systems such as fixed air fans ;

Connection to a cooling network.
Impact evaluation
Between 2005 and 2011, this scheme has supported more than €9M of refurbishment works for 7 million
of dwellings2 3. In 2012, 1.23 million of households benefited from an average amount of €1,107 tax
credit for an average amount of €5,549 of refurbishment works.
According to estimations from the ADEME’s micro-simulation model Menfis, the theoretical primary
energy consumption of residential dwellings would have been reduced of 8 % between 2008 et 2010, and
theoretical GHG emissions (except rebound effect) would have decreased of 7.5% thanks to this tax
credit scheme.
Global statistics on the scheme until 2010 (DGFiP)
2005 2006 2007 2008 2009 2010
Total
Number of residential beneficiaries (in millions)
Number of new households (in millions)
0,98
1,25
1,32
1,47
1,46
1,41
7,89
0,98
1,09
1,05
1,12
1,03
0,93
6,21
Total amount of reported works (in billion €)
3,53
5,1
5,63
7,71
8,39
8,27
38,64
Amount of tax credit (in billion €)
0,98
1,87
2,09
2,64
2,49
1,93
12
Average reported amount of works (in k€)
3.6
4.1
4.3
5.2
5.7
5.9
4.9
1
1.5
1.6
1.8
1.7
1.4
1.5
Average amount of the tax credit (in k€)
Average rate of subsidy (in %)
28
37
37
34
30
23
Table1- Amount of work performed under the CIDD between 2005 and 2010 in France
(Source: DGFiP, exhaustif fiscal 2005-2010)
2
3
Among 27 millions of main residences
Tax credit are set up the year after the implementation of refurbishment
31
Last update: October 2015
Condensing boilers
Walls insulation
Roof insulation
Glazed walls insulation
Ind. solar water heaters
Combined solar systems
Heat pumps
Wood burning inserts
Woodstoves
Wood boilers
Table 2- Amount of work performed under the CIDD from 2009 to 2012
(Source: NEEAP 2014)
Opinion pool from TNS Sofres (2013)
The study performed by the polling institute TNS Sofres in 2013 has analysed the behaviours of 10,000
French households regarding energy supply management. Among the data collected, it has followed the
evolution of the awareness of CIDD (ex-CITE):
Graph 1 - Households aware of the tax credit (%)
(Source: Maîtrise de l’énergie - Bilan 2013 – TNS Sofres for ADEME)
Graph 2 - Can CIDD get you change your heating or hot water system, or to improve the insulation of
your home in the next 2 years?
(Source: Maîtrise de l’énergie - Bilan 2013 – TNS Sofres for ADEME)
Market analysis
The evaluation carried out in 2007 by the General Direction for Treasury and Economical Politic
(Direction Générale du Trésor et de la politique économique - DGTPE) has shown:

An important growth in the development of energy efficiency materials and equipment
using renewable energies.
Indeed the implementation of the tax credit in favour of energy savings and renewable energies in 2005
has revitalised the domestic market of energy saving equipment. For example, between 2004 and 2015,
the market of thermal solar and combined solar system has increased of 250%.
Last update: October 2015
2004
2005
Evolution
Thermal solar -Individual solar water
8,150
16,500
+102%
heater
Thermal solar -Combined solar system
600
2,100
+250%
Wood – independent appliances
315,000
209,000
-34%
Wood - boiler
8,800
11,000
+25%
Air to water and geothermal heat pump
17,000
21,000
+24%
Condensing boiler
33,000
44,600
+35%
Table 3 – Evolution of the number of actions made with tax credit (Source: DGTEP, 2007)

But an unbalanced tool
Thermal insulation (walls)
Low temperature boiler
Condensing boiler
Gross costs in
October 2006 (M€)
2.2
Individual
Collective
Individual
Collective
88
39.3
Gross cost per
saved tCO2 (€)
2
15.8
4,1
31.4
10.4
Gross cost (M€)
Wood (independent
118.5
42.8 - 45.5
appliances, boiler)
Geothermal and air to water
89.3
96.7
heat pump
Thermal solar
33.9
290.3-322.6
Thermal insulation (glazing)
460.8
136.9
Table 4 – Gross costs of each action and gross cost per saved tCO2
Gross cost per saved tCO2 (€)
ILTB: individual low temperature boiler
ICB: individual condensing boiler
CLTB: collective low temperature boiler
CCB: collective condensing boiler
Graph 3 – Gross costs of each action and gross costs per saved tCO2
Insulation represented 50% of total costs and was almost exclusively dedicated to windows (45% of
total costs) to the detriment of the insulation of the walls (3.6% of total cost) even if the
Last update: October 2015
efficiency/cost ratio for walls insulation was much better than for glazing: walls insulations allowed to
save one tCO2 with 2€ whereas glazing cost137€ to save the same amount of CO2.
Moreover, there has been a free-rider effect: many people would have put this new glazing even without
the tax credit. Indeed, the criteria to benefit from a tax credit for glazing are very low: one can get a tax
credit for almost 80% of glazing market (and only 8% of walls insulation market).
Energy savings
Energy saved and potentially saved thanks to this scheme has been assessed from the SceGES4 tool from
the French General Direction for Energy and Climate (DGEC) thanks to a bottom-up approach describing
the physical determinants of this credit tax measure: 1.08 Mtoe would be saved within 2020 thanks to this
measure.
In 2013 the residential sector energy consumption was about 39.6 Mtoe and 0.78 Mtoe would have been
saved thanks to this scheme which has therefore a high impact on the residential sector overall energy
consumption.
Final energy savings (Mtoe)
2013
0.78
(ex-post)
2016
0.93
(ex-ante)
2020
1.08
(ex-ante)
Measure Impact Level
 low
 medium
 high
Definition of impact:
Low: energy savings < 0.1% the of overall residential sector energy consumption
Medium: between 0.1 and 0.5%
High: > 0.5%
Interaction of measures
HOU-FRA5 VAT Reduction on energy efficiency investments
HOU-FRA31 Zero-rated eco-loan
HOU-FRA45 Energy Savings Certificates
Historical data
In 2005, in the framework of the French POPE law (Programme fixant les orientations politiques
énergétiques), France has targeted to divided by 4 its GHG emissions between 1990 and 2050 and
improved its annual energy performance of 2%. Following this law, the government has set up a specific
credit tax for sustainable development and energy efficiency. Before this measure, there was a tax credit
on refurbishment expenses made for main residences but this tax reduction did not depend on the energy
performance of works.
In 2009, with the law Grenelle, the French government has targeted the building sector as a priority since
this sector was identified as the first consumer of final energy and the second source of GHG emissions.
Therefore, it has strengthened its objectives by announcing a target of 38% of energy consumption
4
SceGES comes from « GHG emissions scenarios elaborating» (Scénarisation des Emissions de Gaz à
Effet de Serre)
Last update: October 2015
reduction within 2020 for existing buildings. To reach these objectives, it has extended the duration of the
tax credit scheme and launched the zero-rate eco-loan (see HOU-FRA31for more details).
The “Finance Law 2009” and “Finance Law 2010” have renewed this tax credit scheme until the end of
2014 and extended it to new equipment and made some no more eligible. The “Finance Law 2010” has in
addition amended fixed rates in particular for condensing boilers and glass walls (15%), thermodynamic
systems producing domestic hot water (40%), and underground heat exchangers for geothermal heat
pumps (40%).
Following the success of this scheme, the “Finance Law 2012” has renewed it until the end of 2015 and
has excluded new buildings from the scope since a new thermal regulation (RT 2012) has been set up for
new buildings. In order to simplify the procedures, this “finance law” has also fixed two credit rates: 25%
in the case of a bunch works, 15% otherwise.
The last amended “Finance law 2015” has fixed a single tax credit rate (30%) from the 1st of September
2014 and has constrained tax payers to make their work achieved by certified enterprises Reconnue
Garant de l’Environnement (RGE) to be eligible to the tax credit from 1st January 2015 in mainland
France (and from 31st December for the French overseas departments).
Tax credit rates between from 2005 to 2015
Type of Characteristics of
works
the main
/equipment
residence
Boilers
Completed for
Low
more than 2
temperature
years
Completed for
more than 2
years
Condensing Completed
before 1977 and
bought for less
than 2 years
Gas
Rates in%
20062008
2005
2009
2010
2011
20122013
2014
201452015
15
25
25
15
13
40
10
(18% if
15% for
included in
one action
bunch of
only
works)
30
25% in the
17
case of a
(26% if
bunch of
included in
works
bunch of
works)
Completed for
more than 2
years
Thermal insulation materials
Opaque
thermal
insulation
Completed for
more than 2
years
Completed
before 1977 and
bought for less
than 2 years
25
22
40
25
25
Completed for
Glazed walls
more than 2
and shutters
years
thermal
Completed
insulation
before 1977 and
5
25
15
13
40
The unique rate of 30% is available since the 1st September of 2014
15
(23% in
case of
bunch of
works
except for 15% for
low floor one action
on
only
basement,
open space, 25% in the
crawl
case of a
space)
bunch of
works
0-10
(18% in
case of
bunch of
works
30
Last update: October 2015
bought for less
than 2 years
Front door Completed for
acceding
more than 2
outdoor
years
Completed for
more than 2
25
Heating
years
regulation
25
25
Completed
and heat
before 1977 and
insulating
40
bought for less
than 2 years
Energy production equipment using renewable energy source
except for
front door
and
isolating
shutters)
22
15
15% for
one action
only
General cases
50
45
50
Energy
producing
All buildings
systems from (new buildings
photovoltaic included)6
installations
40
50
50-25
40
30
11
22
(36%7)
Boilers and
heating
equipment
working with
wood or
biomass
32
(40% if
included in
25% in the
bunch of
case of a
works)
bunch of
works
25
15
(26%5)
(23% or
346 if
included in
bunch of
works)
15% for
one action
only
25% in the
case of a
bunch of
works
30
Heating pump for heat generation
15% for
one action
only
General cases
40
All buildings
(new buildings
included)5
40
25
22
50
15
(23% if
included in
25% in the
bunch of
case of a
works)
bunch of
works
30
26
(34% if
15% for
included in one action
bunch of
only
works8)
25% in the
26
30
Air/air
Geothermal
Thermodyna
6
40
40
36
40
From the 1st January 2013, new buildings (completed before the last 2 years) are no more eligible to this
tax credit
7
In case of equipment replacement
8
Works for the underground heat exchanger installation are not eligible to bonus in case of bunch of
works
Last update: October 2015
mic (except
air/air) for
domestic hot
water
production
Equipment
for
connection to
heating
network
(34% if case of a
included in bunch of
bunch of
works
works)
25
22
15
22
15
45
11
Others
Equipment
All buildings
for rainwater
(new buildings
collection
included)5
and treatment
Energy
Completed for
performance more than 2
diagnostics years
Heating
regulation
and
programming
systems
Equipment
enabling
individual
heating costs
or hot water
accounting
Electric
vehicle
charging
station
25
50
15% for
one action
only
30
25% in the
case of a
bunch of
works
References

Legislative and administrative acts
Lois de finances (“Finance laws”) 2005, 2006, 2009, 2010, 2011, 2012, 2014, 2015
Arrêté du 9 octobre 2015 modifiant les conditions d’éligibilité des aides publiques attribuées à l’occasion
de travaux de rénovation énergétique dans les logements situés en Guadeloupe, en Martinique, en
Guyane, à La Réunion et à Mayotte
Décret n°2015-1262 du 9 octobre 2015 modifiant le décret no 2014-812 du 16 juillet 2014 pris pour
l’application du second alinéa du 2 de l’article 200 quater du code général des impôts et du dernier alinéa
du 2 du I de l’article 244 quater U du code général des impôts
Décret n°2014-812 du 27 février 2015 « pris pour l’application du second alinéa du 2 de l’article 200
quater du code général des impôts et du dernier alinéa du 2 du I de l’article 244 quater U du code général
des impôts»
Arrêté du 16 juillet 2014 relatif aux critères de qualifications requis pour le bénéfice du crédit d'impôt
développement durable et des avances remboursables sans intérêts destinées au financement de travaux de
rénovation afin d'améliorer la performance énergétique des logements anciens
Décret n° 011-520 du 13 mai 2011 pris pour l'application de l'article 105 de la loi n° 2010-1657 du 29
décembre 2010 de finances pour 2011
Last update: October 2015
Loi n°2005-781 du 13 juillet 2005 de programme fixant les orientations de la politique énergétique
Code Général des Impôts – article 200 quater

Evaluations
Report from the evaluation comity on the fiscal expenses and social tax exemption (Rapport du comité
d’évaluation des dépenses fiscales et des niches sociales), 2011
Synthesis of the tax credit scheme assessment (Synthèse de l’évaluation du crédit d’impôt développement
durable), April 2011
www.economie.gouv.fr/files/import/rapport-depenses-fiscales/Annexe-D-rapport-CIDD.pdf
Econometric assessment from the National Institute of Statistics and Economic Studies (INSEE), Le
crédit d’impôt dédié au développement durable: une évaluation économétrique), September 2012

For further information
Specific sections of governmental websites:
- www.economie.gouv.fr/cedef/economie-energie-credit-dimpot
- www.developpement-durable.gouv.fr/Le-credit-d-impot-transition
Rénovation Info Service website to help households to get information on how to fund renovation works:
www.renovation-info-service.gouv.fr/
Publication from ADEME on RGE qualification and certification for renovation including list of works
whose RGE qualification is mandatory to get taxes credit (Le guide pratique « Choisir un professionnel
pour ses travaux »)
The national agency for information on housing website (Agence nationale pour l’information sur le
logement - ANIL): www.anil.org/
Financial supports guide for energy renovation existing building published by ADEME:
www.ademe.fr/sites/default/files/assets/documents/guide-aides-financieres-renovation-habitat-2015.pdf