State-scale evaluation of renewable electricity policy: The role of renewable electricity credits and carbon taxes

We have developed a state-scale version of the MARKAL energy optimization model, commonly used to model energy policy at the US national scale and internationally. We apply the model to address state-scale impacts of a renewable electricity standard (RES) and a carbon tax in one southeastern state, Georgia. Biomass is the lowest cost option for large-scale renewable generation in Georgia; we find that electricity can be generated from biomass co-firing at existing coal plants for a marginal cost above baseline of 0.2–2.2 cents/kWh and from dedicated biomass facilities for 3.0–5.5 cents/kWh above baseline. We evaluate the cost and amount of renewable electricity that would be produced in-state and the amount of out-of-state renewable electricity credits (RECs) that would be purchased as a function of the REC price. We find that in Georgia, a constant carbon tax to 2030 primarily promotes a shift from coal to natural gas and does not result in substantial renewable electricity generation. We also find that the option to offset a RES with renewable electricity credits would push renewable investment out-of-state. The tradeoff for keeping renewable investment in-state by not offering RECs is an approximately 1% additional increase in the levelized cost of electricity.     

The role of public policy in optimizing renewable energy development in the greater southern Appalachian mountains

This research presents a third component of a comprehensive decision support system for energy planning that allows for combining existing electricity generating capabilities with increased use of renewable energy sources. It focuses on energy planning at the regional level, and concentrates specifically on the greater southern Appalachian mountains of the eastern United States: a region that was chosen for analysis not only due to its heavy dependence on coal for electricity, but also because of its potential for increased use of wind and solar power. Previous research used a geographic information system (GIS) model for identifying renewable energy potential to provide input data for a multi-objective linear programming (MOLP) model to determine the optimal constrained mix of renewable energy sources and existing fossil fuel facilities by balancing annual generation costs against the corresponding greenhouse gas emissions. This new component of the system analyzes three potential public policies—renewable portfolio standard, carbon tax, and renewable energy production tax credit—that have been used to foster increased renewable energy usage. These policies require minor modifications to the MOLP model for implementation. The results of these policy cases were then analyzed to determine the impact that these policies have on generation cost and pollution emissions within the region.     

Renewable energy policy in Turkey with the new legal regulations

Since the energy crises in the 1970’s, public and private decision makers are considering how to achieve a sustainable transition from fossil fuel based energy to sustainable and clean energies - namely renewable energies. Combined with the improvement of energy efficiency and the rational use of energy, renewable energy can provide everything fossil fuels currently offer in terms of heating and cooling, electricity generation and transportation. Renewable energy technologies posses many long term benefits including energy security, job creation, business opportunities, sustainable development and prevention of global warming.Turkey’s population is growing at an annual rate of 1.04%. If Turkey uses only traditional energy sources, it simply will not have enough energy capacity for its population. Renewable energy sources have the potential to make a large contribution to Turkey’s sustainable and independent energy future.Turkey aims to utilize its energy potential, including from renewable sources in a cost-effective manner. Turkey targets the share of renewable resources in electricity generation to be at least 30% by 2023 has in its 2009 Electricity Market and Security of Supply Strategy. Positive achievements have been obtained in renewable energy development and manufacturing in Turkey over the past decade. The renewable energy related legislation has been intensified. To meet its 30% target, the current promotion mechanism for renewable sources of electricity relies on feed-in tariffs for different renewable energy sources. Large hydropower is already competitive to conventional fossil-based electricity, so feed-in tariffs in the new RE Law are set to facilitate expanding the deployment of other, less mature renewable energy technologies.     

Green electricity policies in the Netherlands: an analysis of policy decisions

Over the last decades, fundamental changes can be observed in both market conditions and the national policy framework for green electricity in the Netherlands. The Dutch Government has regularly intervened in markets, demonstrating fundamental shifts in policy and approach. This study aims to analyse the developments in renewable energy policy making in the Netherlands. It assesses changes in the choice of policy instruments and target groups, the role of stakeholders, and offers explanations behind policy successes and failures. Dutch green electricity policy over the last decade can be characterised roughly by three phases: in the early 1990s, the government negotiated voluntary agreements with the energy distribution sector on targets for green electricity sales, which were never met. In the second half of the 1990s, a regulatory energy tax was introduced, from which customers of green electricity were exempt. This led to a substantial increase in demand, which was largely met by green electricity imports, and did not lead to additional domestic renewable energy capacity. Finally, a change in policy has taken place recently (2003) shifting the focus from promotion of demand to the promotion of supply through a system of regulated feed-in tariffs. Despite the renewable energy policies, growth of the renewable energy market in the Netherlands has been small and targets have not been fully met. The Dutch government has not yet succeeded in substantially reducing market uncertainties and in building confidence among market parties, because the policies have not been stable and policy objectives have frequently been partly ambiguous. In addition, the influence of stakeholders in renewable energy policy making has been small which has the early acceptance and implementation of alternative policies.     

Federal policies for renewable electricity: Impacts and interactions

Three types of policies that are prominent in the federal debate over addressing greenhouse gas emissions in the United States are a cap-and-trade program (CTP) on emissions, a renewable portfolio standard (RPS) for electricity production, and tax credits for renewable electricity producers. Each of these policies would have different consequences, and combinations of these policies could induce interactions yielding a whole that is not the sum of its parts. This paper utilizes the Haiku electricity market model to evaluate the economic and technology outcomes, climate benefits, and cost-effectiveness of three such policies and all possible combinations of the policies. A central finding is that the carbon dioxide (CO₂) emissions reductions from CTP can be significantly greater than those from the other policies, even for similar levels of renewable electricity production, since of the three policies, CTP is the only one that distinguishes electricity generated by coal and natural gas. It follows that CTP is the most cost-effective among these approaches at reducing CO₂ emissions. An alternative compliance payment mechanism in an RPS program could substantially affect renewables penetration, and the electricity price effects of the policies hinge partly on the regulatory structure of electricity markets, which varies across the country.     

Public perceptions of opportunities for community-based renewable energy projects

It now widely acknowledged that the UK needs to increase renewable energy capacity and it has been claimed that community-based renewable energy projects, with high levels of public participation, are more likely to be accepted by the public than top-down development of large-scale schemes and may bring additional benefits such as increased engagement with sustainable energy issues. However, little research has investigated public expectations of how people would like to participate in such projects and why. The aim of this study was to explore one rural community's response to a proposed sustainable energy project. A questionnaire survey and semi-structured interviews provided quantitative and qualitative data. There was widespread support for local generation and use of renewable energy, with respondents expecting benefits from a project in terms of increased community spirit and conservation of natural resources. However, desire for active involvement was lower and residents viewed themselves participating as consultees, rather than project leaders. We suggest community renewable energy projects are likely to gain public acceptance but are unlikely to become widespread without greater institutional support.     

Design limitations in Australian renewable electricity policies

Renewable electricity is pivotal to the medium and long-term reduction of Australia’s greenhouse gas (GHG) emissions, if deep cuts in them are eventually implemented. This paper examines the effectiveness of the principal existing policies that could potentially promote the expansion of renewable electricity (RElec) in Australia: the expanded Renewable Energy Target (RET); the proposed emissions trading scheme (ETS); and the state and territory-based feed-in tariffs. We find the effectiveness of RET is severely eroded by the inclusion of solar and heat pump hot water systems; by the inclusion of ‘phantom’ tradable certificates; and by high electricity consumption growth. We also find that the ETS will not produce a high enough carbon price to assist most RElec technologies before 2020; and that most of the feed-in tariffs exclude large-scale RElec and will give little assistance to small-scale RElec because they are mostly net tariffs. Unless there is a major revision of its RElec policy mechanisms, Australia will fail to reach its renewable electricity target and in particular will fail to build up its solar generation capacity which could be a major source of future deep cuts in the country’s electricity generation emissions.     

A market for renewable energy credits in the Indian power sector

Electricity generation from renewable energy sources in India has been promoted through a host of fiscal policies and preferential tariff for electricity produced from the same. The fiscal policies include tax incentives and purchase of electricity generated through renewable energy sources. The enactment of the Electricity Act 2003 (the Act) has lent further support to renewable energy by stipulating purchase of a certain percentage of the power procurement by distribution utilities from renewable energy sources. The renewable portfolio obligation as well as the feed-in tariff for power procurement has been specified by a number of State Electricity Regulatory Commissions (SERCs) for the respective state under their jurisdiction. A feed-in tariff determined through a cost-plus approach under a rate of return framework lacks incentive for cost minimisation and does not encourage optimal utilisation of renewable energy resources in the country. Such regulatory provisions differ across states.The prevalent practice of fixing a renewable portfolio obligation along with cost-based feed-in tariffs disregards economic efficiency. The paper proposes nationally tradable renewable energy credits scheme for achieving the targets set by the respective SERCs as renewable portfolio obligation. This would reduce the cost of compliance to a renewable portfolio obligation, and would encourage efficient resource utilisation and investment in appropriate technologies. The paper highlights its advantages and implementation issues. This paper discusses regulatory developments for promotion of renewable energy in various Indian states. The paper also identifies a number of issues related to regulations concerning renewable portfolio obligation.     

An econometric analysis of residential expenditures on energy conservation and renewable energy sources

Economic theory suggests that residential expenditures on energy conservation and renewable energy sources will be determined by the ability of households to purchase conservation inputs, their incentive to invest in conserving energy, the energy efficiency of existing homes and miscellaneous factors such as climate and age of the home-owner. Empirical analyses of energy-related expenditures reported on individual income tax returns confirm the importance of household income, energy price increases and climate conditions in determining energy conservation investments. Income tax credits are also found to have stimulated residential spending on conservation and renewable energy.     

The importance of comprehensiveness in renewable electricity and energy-efficiency policy

Based on extensive research interviews and supplemented with a review of the academic literature, this article assesses the best way to promote renewable energy and energy efficiency. It begins by briefly laying out why government intervention is needed, and then details the four most favored policy mechanisms identified by participants: eliminating subsidies for conventional and mature electricity technologies, pricing electricity accurately, passing a national feed-in tariff, and implementing a nationwide systems benefit fund to raise public awareness, protect lower income households, and administer demand side management programs. Drawing mostly from case studies in the United States, the article also discusses why these policy mechanisms must be implemented comprehensively, not individually, if the barriers to renewables and energy efficiency are to be overcome.     

Analysing the impact of renewable electricity support schemes on power prices: The case of wind electricity in Spain

It is sometimes argued that renewables are “expensive”. However, although it is generally true that the private costs of renewable electricity generation are certainly above those of conventional electricity, that statement fails to consider the social benefits provided by electricity from renewable energy sources (RES-E), including environmental and socioeconomic ones. This paper empirically analyses an additional albeit usually neglected benefit: the reduction in the wholesale price of electricity as a result of more RES-E generation being fed into the grid. The case of wind generation in Spain shows that this reduction is greater than the increase in the costs for the consumers arising from the RES-E support scheme (the feed-in tariffs), which are charged to the final consumer. Therefore, a net reduction in the retail electricity price results, which is positive from a consumer point of view. This provides an additional argument for RES-E support and contradicts one of the usual arguments against RES-E deployment: the excessive burden on the consumer.     

Comparative analysis of support mechanisms for renewable energy technologies using probability distributions

In this paper, a probabilistic model is developed to assess the effects of different support mechanisms on the financial return of small-scale hydroelectric, wind energy and solar PV systems. Besides, the results from this model are used to compare the economic effectiveness of each mechanism in increasing the profitability of these projects. We focus on three renewable energy support mechanisms: governmental grants, feed in tariffs (FiT) and renewable energy certificates (RECs). We also consider the effect of the carbon credits on the net present value of renewable projects and compare it with the other support mechanisms. The simulation results demonstrate that the feed in tariffs is the best mechanism to increase the profitability of solar PV systems and wind energy projects. Conversely, green certificate mechanism favors the most competitive technology as the hydropower. In addition, it is shown that the governmental grants and carbon credits are secondary support mechanisms compared to FiT and RECs. And, the carbon credits play a more important role than governmental grants as the energy output of the system increase. Finally, it can be concluded that the efficiency of the support mechanisms varies depending on stage of development of the renewable technologies that are implemented.     

德国最新《可再生能源法》及其对我国的启示

可再生能源法是推动可再生能源发展的重要制度保障,本文详细介绍了德国最新修订后的《可再生能源法》（EEG-2012）,EEG-2012首次明确了2050年德国可再生能源在电力供应中的份额要达到80％,同时EEG-2012对可再生能源电力的并网、收购、传输、配送等环节,对不同技术类型可再生能源电力的上网电价,对可再生能源发电的平衡方案、信息通报和公开义务、可再生能源发展追踪等都进行了详细和明确的规定.通过对德国EEG-2012的解析和思考,本文提出了对我国可再生能源电力发展的一些重要启示和政策建议.     

Analysing the interactions between renewable energy promotion and energy efficiency support schemes: The impact of different instruments and design elements

CO₂ emissions reduction, renewable energy deployment and energy efficiency are three main energy/environmental goals, particularly in Europe. Their relevance has led to the implementation of support schemes in these realms. Their coexistence may lead to overlaps, synergies and conflicts between them. The aim of this paper is to analyse the interactions between energy efficiency measures and renewable energy promotion, whereas previous analyses have focused on the interactions between emissions trading schemes (ETS) and energy efficiency measures and ETS and renewable energy promotion schemes. Furthermore, the analysis in this paper transcends the “certificate” debate (i.e., tradable green and white certificates) and considers other instruments, particularly feed-in tariffs for renewable electricity. The goal is to identify positive and negative interactions between energy efficiency and renewable electricity promotion and to assess whether the choice of specific instruments and design elements within those instruments affects the results of the interactions.     

Factors affecting economics of clean energy transmission channel in Southeast Asia

This paper addresses the issues regarding the economics of clean energy transmission channels in Southeast Asia. The research developed an improved comprehensive model for the generation and transmission planning considering variable renewable energy characteristics, and it simulated the hourly resolution operation condition of a cross-regional interconnection grid of Southeast Asia, China, and South Asia. Additionally, we conducted a sensitivity analysis, and the assessment of the channels’ eco...     

Tax incentives to promote green electricity: An overview of EU-27 countries

This paper provides a comprehensive overview of the main tax incentives used in the EU-27 member states (MSs) to promote green electricity. Sixteen MSs use tax incentives to promote green electricity simultaneously with other promotion measures, especially quota obligations and price regulation. However, not all available technologies are promoted. For example, six MSs (Germany, Romania, Slovak Republic, Denmark, Sweden and Poland) have included an exemption on the payments of excise duties for electricity when the electricity is generated from renewable energy sources (RES). This tax incentive is the most widely used. Limited tax incentives in personal income tax are available in Belgium, France, Czech Republic and Luxembourg. In corporate tax, tax incentives consist mainly of a deduction in the taxable profit (Belgium, Greece, Czech Republic and Spain). Lower tax rates in VAT are applied in three MSs, France, Italy and Portugal. Only Spain and Italy use effective tax incentives in property tax. As a great diversity of tax incentives has been used to promote green electricity, this adds another difficulty to the EU objective of providing a renewable energy policy framework, but also it offers a useful set of case studies which can be used to inform EU policy development.     

RE in EU-28: Renewable energy policies in an enlarged European Union

The goal of increasing the share of renewable energy sources (RES) in total primary energy supply (TPES) as well as in electricity production in an enlarged European Union (EU-28) will be a challenging one and most likely will be addressed by a mix of promotion instruments. Mischa Bechberger and Danyel Reiche take a look at the implications for renewables in an enlarged EU.The most prominent policies in the case of electricity are renewable energy feed-in tariffs (REFIT) and quota systems, but also others like tenders, energy tax exemptions, and environmental funds in the form of investment subsidies, and soft loans are playing a part.     

Renewable electricity in Sweden: an analysis of policy and regulations

This study aims to analyse the developments in renewable energy policy making in Sweden. It assesses the energy policy context, changes in the choice of policy instruments, and provides explanations behind policy successes and failures. Swedish renewable energy policy has been developing in a context of uncertainty around nuclear issues. While there has been made a political decision to replace nuclear power with renewables, there is a lack of consensus about the pace of phasing out nuclear power due to perceived negative impacts on industrial competitiveness. Such uncertainty had an effect in the formulation of renewable energy policy. Biomass and wind power are the main options for renewable electricity production. Throughout 1990s, the combined effect of different policy instruments has stimulated the growth of these two renewable sources. Yet, both biomass and wind power are still a minor contributor in the total electricity generation. Lack of strong government commitment due to uncertainty around nuclear issues is a crucial factor. Short-term subsidies have been preferred rather than open-ended subsidy mechanisms, causing intervals without subsidies and interruption to development. Other factors are such as lack of incentives from the major electricity companies and administrative obstacles. The taxation system has been successful in fostering an expansion of biomass for heating but hindered a similar development in the electricity sector. The quota system adopted in 2003 is expected to create high demand on biomass but does not favour wind power. The renewable energy aims are unlikely to be changed. Yet, the future development of renewable energy policies especially for high-cost technologies will again depend strongly on nuclear policies, which are still unstable and might affect the pace of renewable energy development.     

An international comparison of four polycentric approaches to climate and energy governance

Drawing from work on governance, this article explores four programs and policies that respond in some way to the challenges induced by climate change and modern energy use. Relying primarily on original data collected from research interviews and field research in seven countries along with four case studies, the article notes that polycentric approaches – those that mix scales (such as local/national or national/global), mechanisms (such as subsidies, tax credits, and mandates), and actors (such as government regulators, business stakeholders, and members of civil society) – can foster equity, inclusivity, information, accountability, organizational multiplicity, and adaptability that result in the resolution of climate and energy related problems. After explaining its case selection and research methods, defining climate and energy governance, and conceptualizing polycentrism, the study explores cases related to electricity supply in Denmark, ethanol production in Brazil, small-scale renewable energy in Bangladesh, and off-grid energy use in China. It concludes by highlighting how polycentrism may enhance effective climate and energy governance, but that further research is needed to fully substantiate that claim.     

Integration and economic viability of fueling the future with green hydrogen: An integration of its determinants from renewable economics

The volatility of fossil fuel and their increased consumption have exacerbated the socio-economic dilemma along with electricity expenses in third world countries around the world, Pakistan in particular. In this research, we study the output of renewable hydrogen from natural sources like wind, solar, biomass, and geothermal power. It also provides rules and procedures in an attempt to determine the current situation of Pakistan regarding the workability of upcoming renewable energy plans. To achieve this, four main criteria were assessed and they are economic, commercial, environmental, and social adoption. The method used in this research is the Fuzzy Analytical Hierarchical Process (FAHP), where we used first-order engineering equations, and Levelized cost electricity to produce renewable hydrogen. The value of renewable hydrogen is also evaluated. The results of the study indicate that wind is the best option in Pakistan for manufacturing renewable based on four criteria. Biomass is found to be the most viable raw material for the establishment of the hydrogen supply network in Pakistan, which can generate 6.6 million tons of hydrogen per year, next is photovoltaic solar energy, which has the capability of generating 2.8 million tons. Another significant finding is that solar energy is the second-best candidate for hydrogen production taking into consideration its low-cost installation and production. The study shows that the cost of using hydrogen in Pakistan ranges from $5.30/kg to $5.80/kg, making it a competitive fuel for electric machines. Such projects for producing renewable power must be highlighted and carried out in Pakistan and this will lead to more energy security for Pakistan, less use of fossil fuels, and effective reduction of greenhouse gas emissions.