China’s renewable energy policy: Commitments and challenges

The passing of the Renewable Energy Law (REL) in 2005 demonstrated China’s commitment to renewable energy development. In the 3 years after the REL, China’s renewable electricity capacity grew rapidly. From 2006 to 2008, China’s wind capacity installation more than doubled every year for 3 years in a row. However, three facts prevent us from being optimistic about China’s renewable electricity future. First, considered as a share of total capacity, renewable electricity capacity is decreasing instead of increasing. This is due simply to the rapid growth of fossil fuel capacity. Second, a significant amount of renewable generation capacity is wasted because it is not connected to the electricity grid. Finally, renewable electricity plants are running at a low level of efficiency. Based on an in-depth analysis of China’s existing renewable energy policy, we suggest that these challenges should be dealt with by introducing a market-based mandatory renewable portfolio requirement coupled with strong regulatory monitoring of grid enterprises.     

Successful renewable energy development in a competitive electricity market: A Texas case study

The development of renewable energy in markets with competition at wholesale and retail levels poses challenges not present in areas served by vertically-integrated utilities. The intermittent nature of some renewable energy resources impact reliability, operations, and market prices, in turn affecting all market participants. Meeting renewable energy goals may require coordination among many market players.     

Non-renewable and renewable energy consumption and CO2 emissions in OECD countries: A comparative analysis

This paper attempts to explore the determinants of CO₂ emissions using the STIRPAT model and data from 1980 to 2011 for OECD countries. The empirical results show that non-renewable energy consumption increases CO₂ emissions, whereas renewable energy consumption decreases CO₂ emissions. Further, the results support the existence of an environmental Kuznets curve between urbanisation and CO₂ emissions, implying that at higher levels of urbanisation, the environmental impact decreases. Therefore, the overall evidence suggests that policy makers should focus on urban planning as well as clean energy development to make substantial contributions to both reducing non-renewable energy use and mitigating climate change.     

Technological learning and renewable energy costs: implications for US renewable energy policy

This paper analyzes the relationship between current renewable energy technology costs and cumulative production, research, development and demonstration expenditures, and other institutional influences. Combining the theoretical framework of ‘learning by doing’ and developments in ‘learning by searching’ with the fields of organizational learning and institutional economics offers a complete methodological framework to examine the underlying capital cost trajectory when developing electricity cost estimates used in energy policy planning models. Sensitivities of the learning rates for global wind and solar photovoltaic technologies to changes in the model parameters are tested. The implications of the results indicate that institutional policy instruments play an important role for these technologies to achieve cost reductions and further market adoption.     

A review of renewable energy activities in Yemen

Republic of Yemen is a developing country depending on oil for the energy needs. A look at the availability of renewable energy resources shows that the country is endowed with considerable solar, wind, bio-gas energy resources. This paper presents a review of activities in the field of renewable energy applications in Yemen and future trends, some suggestions and recommendations for using this renewable energy resources are also drawn.     

Renewable energy policy and public perceptions of renewable energy: A cultural theory approach

Public opposition to the siting of renewable energy (RE) facilities and public reluctance to invest in RE remain key obstacles to the expansion of the renewables sector in the UK and a number of other European countries. Although there is a growing body of qualitative research on factors that inform public attitudes towards RE, the majority of studies have tended to be quantitative and to view ‘the public’ and ‘public opinion’ as homogeneous wholes. This study uses a cultural theory framework and focus groups conducted in the South West UK to develop deeper understandings of how individuals’ worldviews can inform opinions and behaviour in relation to RE. These findings are used to explore ways in which government policies on RE might be tailored to engender greater public support and participation. Issues discussed include the provision of economic incentives, information on climate change and RE, linking renewables to overall energy behaviour, and landscape aesthetics.     

Electricity market auction settings in a future Danish electricity system with a high penetration of renewable energy sources - A comparison of marginal pricing and pay-as-bid

The long-term goal for Danish energy policy is to be free of fossil fuels through the increasing use of renewable energy sources (RES) including fluctuating renewable electricity (FRE).The Danish electricity market is part of the Nordic power exchange, which uses a Marginal Price auction system (MPS) for the day-ahead auctions. The market price is thus equal to the bidding price of the most expensive auction winning unit. In the MPS, the FRE bid at prices of or close to zero resulting in reduced market prices during hours of FRE production. In turn, this reduces the FRE sources’ income from market sales. As more FRE is implemented, this effect will only become greater, thereby reducing the income for FRE producers.Other auction settings could potentially help to reduce this problem. One candidate is the pay-as-bid auction setting (PAB), where winning units are paid their own bidding price.This article investigates the two auction settings, to find whether a change of auction setting would provide a more suitable frame for large shares of FRE. This has been done with two energy system scenarios with different shares of FRE.From the analysis, it is found that MPS is generally better for the FRE sources. The result is, however, very sensitive to the base assumptions used for the calculations.     

Economic potential of renewable energy in Vietnam's power sector

A bottom-up Integrated Resource Planning model is used to examine the economic potential of renewable energy in Vietnam's power sector. In a baseline scenario without renewables, coal provides 44% of electricity generated from 2010 to 2030. The use of renewables could reduce that figure to 39%, as well as decrease the sector's cumulative emission of CO₂ by 8%, SO₂ by 3%, and NO_x by 4%. In addition, renewables could avoid installing 4.4 GW in fossil fuel generating capacity, conserve domestic coal, decrease coal and gases imports, improving energy independence and security. Wind could become cost-competitive assuming high but plausible on fossil fuel prices, if the cost of the technology falls to 900 US$/kW.     

Large-scale integration of renewable and distributed generation of electricity in Spain: Current situation and future needs

Similar to other European countries, mechanisms for the promotion of electricity generation from renewable energy sources (RESs) and combined heat and power (CHP) production have caused a significant growth in distributed generation (DG) in Spain. Low DG/RES penetration levels do not have a major impact on electricity systems. However, several problems arise as DG shares increase. Smarter distribution grids are deemed necessary to facilitate DG/RES integration. This involves modifying the way distribution networks are currently planned and operated. Furthermore, DG and demand should also adopt a more active role. This paper reviews the current situation of DG/RES in Spain including penetration rates, support payments for DG/RES, level of market integration, economic regulation of Distribution System Operators (DSOs), smart metering implementation, grid operation and planning, and incentives for DSO innovation. This paper identifies several improvements that could be made to the treatment of DG/RES. Key aspects of an efficient DG/RES integration are identified and several regulatory changes specific to the Spanish situation are recommended.     

Financing investments in renewable energy : the impacts of policy design

The costs of electric power projects utilizing renewable energy technologies (RETs) are highly sensitive to financing terms. Consequently, as the electricity industry is restructured and new renewables policies are created, it is important for policymakers to consider the impacts of renewables policy design on RET financing. This paper reviews the power plant financing process for renewable energy projects, estimates the impact of financing terms on levelized energy costs, and provides insights to policymakers on the important nexus between renewables policy design and financing. We review five case studies of renewable energy policies, and find that one of the key reasons that RET policies are not more effective is that project development and financing processes are frequently ignored or misunderstood when designing and implementing renewable energy policies. The case studies specifically show that policies that do not provide long-term stability or that have negative secondary impacts on investment decisions will increase financing costs, sometimes dramatically reducing the effectiveness of the program. Within U.S. electricity restructuring proceedings, new renewable energy policies are being created, and restructuring itself is changing the way RETs are financed. As these new policies are created and implemented, it is essential that policymakers acknowledge the financing difficulties faced by renewables developers and pay special attention to the impacts of renewables policy design on financing. As shown in this paper, a renewables policy that is carefully designed can reduce renewable energy costs dramatically by providing revenue certainty that will, in turn, reduce financing risk premiums.     

Designing renewable energy auctions for India: Managing risks to maximize deployment and cost-effectiveness

We examined 20 renewable energy auctions in India and elsewhere to answer two questions: first, have auctions been effective; and second, how can they be designed to achieve India’s renewable energy targets? The significant contributions lie in the larger sample size, use of secondary and primary research, and application of quantitative and qualitative analysis. We found that auctions are almost always cost-effective, with savings up to 58% from baseline feed-in tariffs. However, auctions may not always be deployment-effective, with only 17% of the auctions with greater than 75% deployment. We then examined how to best design auctions by assessing seven major risks, and found the following: first, for every 1% increase in total risk, deployment effectiveness decreased by 2% points; second, project specific risks have 60% greater impact than auction specific risks; and third, deployment effectiveness is most affected by auction design, completion, and financial risks. We also found that effectiveness of auctions in India can be improved by ensuring competition, improving transmission infrastructure, providing payment guarantees, using pay-as-bid auctions, including stringent penalties for delays, and introducing auctions in a controlled manner.     

A new energy future for South Africa: The political ecology of South African renewable energy

Renewable energy remains a contested topic in South Africa. This paper argues that South Africa can build on the momentum surrounding its introduction of a feed-in tariff by enacting policies that may, if given adequate funding and political effort, allow the country to be a world leader in renewable energy. Given a variety of renewable energy policy options for moving forward, a majority of stakeholders consulted in this study strongly prefer the development of a renewable energy manufacturing cluster, in which government develops coordinated policy mechanisms that attract renewable energy manufacturers, over three other policies suggested by the authors. Interviews with key informants that play critical roles in this decision-making process suggest that there are reasons to remain cautiously optimistic about the country's renewable energy future while cognizant of the challenges that must still be overcome. Opportunities for a low carbon renewable energy transition in South Africa include the prevalence of broad stakeholder consultation, facilitated by civil society, and an innovative policy development context. Significant impediments also exist, however, and include pervasive social issues such as poverty and political inertia, along with the ongoing difficulties facing renewable energy technologies in reaching grid parity with inexpensive and abundant South African coal.     

An assessment of exploiting renewable energy sources with concerns of policy and technology

In recent years, the Taiwanese government has vigorously promoted the development of renewable energy to engage the challenges of gradual depletion of fossil fuels and oil, as well as the intensification of the greenhouse effect. Since the Sustainable Energy Policy Principles were announced in 2008, Taiwanese government has declared that the development of renewable energy should take into account goals that pertain to energy, the environment, and the economy (3E goals). This study aims to assess the 3E goals and renewable energy sources regulated by the Renewable Energy Development Bill that passed in 2009. The fuzzy analytic hierarchy process (FAHP) is used to resolve the multi-goal problem for achieving our research purposes. That is, this research attempts to reveal the suitable renewable energy sources for the purposes of meeting the 3E policy goals. The results first show that environmental goal is the most important to the development of various renewable energy technologies in Taiwan, followed by the economic and energy goals. Additionally, hydropower, solar energy, and wind energy would be the renewable energy sources utilized in meeting the 3E policy goals.     

The renewable energy targets of the Maghreb countries: Impact on electricity supply and conventional power markets

Morocco, Algeria and Tunisia, the three countries of the North African Maghreb region, are showing increased efforts to integrate renewable electricity into their power markets. Like many other countries, they have pronounced renewable energy targets, defining future shares of “green” electricity in their national generation mixes. The individual national targets are relatively varied, reflecting the different availability of renewable resources in each country, but also the different political ambitions for renewable electricity in the Maghreb states. Open questions remain regarding the targets’ economic impact on the power markets. Our article addresses this issue by applying a linear electricity market optimization model to the North African countries. Assuming a competitive, regional electricity market in the Maghreb, the model minimizes dispatch and investment costs and simulates the impact of the renewable energy targets on the conventional generation system until 2025. Special emphasis is put on investment decisions and overall system costs.     

Three options to calculate the percentage renewable energy: An example for a EU policy debate

The European Commission proposed a renewable energy directive with binding targets for the percentage renewable energy, usually calculated with the primary energy method. This method has the disadvantage that for hydro and wind electricity production is counted, whereas for thermal electricity the higher input to power plants is counted. Therefore, the Commission looked for an alternative: the final energy method. Also this method has disadvantages. Firstly, electricity consumption is weighed equally to fuel consumption for heat and transport, neglecting higher primary energy demand for electricity. Secondly, non-energy consumption of energy commodities is neglected, artificially raising the percentage renewable energy. Therefore, I introduce a simple substitution method, which measures renewable energy by comparison with hypothetical equivalent conventional energy. Calculations for EU-27 show that the method strongly affects the contributions of different sectors (electricity, heat and transport), sources and countries. Concluding, any credible calculation method should reflect the trade off between conventional and renewable primary energy. A simple substitution method fulfills this condition, contrary to the primary and final energy method. Using these biased methods may result in policies that are inefficient in terms of saving conventional fuels and avoiding CO₂ emissions, the main underlying goals of the proposed directive.     

Fostering a renewable energy technology industry: An international comparison of wind industry policy support mechanisms

This article examines the importance of national and sub-national policies in supporting the development of successful global wind turbine manufacturing companies. We explore the motivations behind establishing a local wind power industry, and the paths that different countries have taken to develop indigenous large wind turbine manufacturing industries within their borders. This is done through a cross-country comparison of the policy support mechanisms that have been employed to directly and indirectly promote wind technology manufacturing in 12 countries. We find that in many instances there is a clear relationship between a manufacturer's success in its home country market and its eventual success in the global wind power market. Whether new wind turbine manufacturing entrants are able to succeed will likely depend in part on the utilization of their turbines in their own domestic market, which in turn will be influenced by the annual size and stability of that market. Consequently, policies that support a sizable, stable market for wind power, in conjunction with policies that specifically provide incentives for wind power technology to be manufactured locally, are most likely to result in the establishment of an internationally competitive wind industry.     

Rejecting renewables: The socio-technical impediments to renewable electricity in the United States

If renewable power systems deliver such impressive benefits, why do they still provide only 3 percent of national electricity generation in the United States? As an answer, this article demonstrates that the impediments to renewable power are socio-technical, a term that encompasses the technological, social, political, regulatory, and cultural aspects of electricity supply and use. Extensive interviews of public utility commissioners, utility managers, system operators, manufacturers, researchers, business owners, and ordinary consumers reveal that it is these socio-technical barriers that often explain why wind, solar, biomass, geothermal, and hydroelectric power sources are not embraced. Utility operators reject renewable resources because they are trained to think only in terms of big, conventional power plants. Consumers practically ignore renewable power systems because they are not given accurate price signals about electricity consumption. Intentional market distortions (such as subsidies), and unintentional market distortions (such as split incentives) prevent consumers from becoming fully invested in their electricity choices. As a result, newer and cleaner technologies that may offer social and environmental benefits but are not consistent with the dominant paradigm of the electricity industry continue to face comparative rejection.     

Renewable energy policy and electricity market reforms in China

The article examines the potential effectiveness of the renewable energy policy in China and its regulatory Law framework. It frames the option of renewable energy technology within the background of the long-lasting electricity problems that China has faced including serious supply shortages, reliance on coal, and severe environmental contamination. Its dual administrative and ownership system based on state and privately owned industry is discussed together with the market reform measures adopted in the sector. Current renewable energy policy is analysed, and the scope of the 2005 Renewable Energy Promotion Law is investigated. This is conducted within the context of the electricity sector reform that China adopted, and its effects upon the prospects of encouraging as well as expanding the development of renewable energy. This study draws upon primary information collected from interviews with stakeholders on the policy adequacy, and identifies three main types of shortcomings that have interfered with a more successful expansion of renewable energy in China.     

Potential of renewable energy systems in China

Along with high-speed economic development and increasing energy consumption, the Chinese Government faces a growing pressure to maintain the balance between energy supply and demand. In 2009, China has become both the largest energy consumer and CO₂ emitting country in the world. In this case, the inappropriate energy consumption structure should be changed. As an alternative, a suitable infrastructure for the implementation of renewable energy may serve as a long-term sustainable solution. The perspective of a 100% renewable energy system has been analyzed and discussed in some countries previously. In this process, assessment of domestic renewable energy sources is the first step. Then appropriate methodologies are needed to perform energy system analyses involving the integration of more sustainable strategies. Denmark may serve as an example of how sustainable strategies can be implemented. The Danish system has demonstrated the possibility of converting into a 100% renewable energy system. This paper discusses the perspective of renewable energy in China firstly, and then analyses whether it is suitable to adopt similar methodologies applied in other countries as China approaches a renewable energy system. The conclusion is that China’s domestic renewable energy sources are abundant and show the possibility to cover future energy demand; the methodologies used to analyse a 100% renewable energy system are applicable in China. Therefore, proposing an analysis of a 100% renewable energy system in China is not unreasonable.