Decision support system for exploiting local renewable energy sources: A case study of the Chigu area of southwestern Taiwan

The topic of climate and energy policy has drawn new attention since the Kyoto Protocol has now come into force. It is hoped that strengthened use of renewable energy sources can meet new international environmental requirements and provide self-sufficient domestic energy supplies. The decision support system established in this study integrates potential evaluations, cost analyses, legal incentives, and analysis of returns on investments with the aid of a geographic information system (GIS). This system can provide insights for policymakers into where and the extent of the potentials, for lawmakers into whether the current legal incentives are sufficient to encourage private investment, and for investors into whether investments in exploiting local renewable energy sources are economically feasible. Under the current incentive framework in Taiwan, the amortization periods of investment on renewable energy are generally longer than the period over which the investment is to be recovered. This presents an unfavorable condition for attracting investments to and for developing renewable energy. An increase in remuneration through legal revisions is needed before domestic investment in renewable energy will actively expand.     

Impact of single versus multiple policy options on the economic feasibility of biogas energy production: Swine and dairy operations in Nova Scotia

The economic feasibility of on-farm biogas energy production was investigated for swine and dairy operations under Nova Scotia, Canada farming conditions, using net present value (NPV), internal rate of return (IRR), and payback period (PP) economic decision criteria. In addition, the effects of selected environmental and “green” energy policy schemes on co-generation of on-farm biogas energy production and other co-benefits from anaerobic digestion of livestock manure were investigated. Cost-efficiencies arising from economies of scale for on-farm anaerobic biogas production were found for swine farms, and less so for dairy production systems. Without incentive schemes, on-farm biogas energy production was not economically feasible across the farm size ranges studied, except for 600- and 800-sow operations. Among single policy schemes investigated, green energy credit policy schemes generated the highest financial returns, compared to cost-share and low-interest loan schemes. Combinations of multiple policies that included cost-share and green energy credit incentive schemes generated the most improvement in financial feasibility of on-farm biogas energy production, for both swine and dairy operations.     

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.     

Adoption of residential solar power under uncertainty: Implications for renewable energy incentives

Many incentives at the state and federal level exist for household adoption of renewable energy like solar photovoltaic (PV) panels. Despite generous financial incentives the adoption rate is low. We use the option value framework, which takes into account the benefit of delaying investment in response to uncertainty, to examine the decision by households to invest in solar PV. Using a simulation model, we determine optimal adoption times, critical values of discounted benefits, and adoption rates over time for solar PV investments using data from Massachusetts. We find that the option value multiplier is 1.6, which implies that the discounted value of benefits from solar PV needs to exceed installation cost by 60% for investment to occur. Without any policies, median adoption time is eight years longer under the option value decision rule compared to the net present value decision rule where households equate discounted benefits to installation cost. Rebates and other financial incentives decrease adoption time, but their effect is attenuated if households apply the option value decision rule to solar PV investments. Results suggest that policies that reduce the uncertainty in returns from solar PV investments would be most effective at incentivizing adoption.     

Optimal regulation of renewable energy: A comparison of Feed-in Tariffs and Tradable Green Certificates in the Spanish electricity system

Incentives for renewable energy based on Feed-in-Tariffs have succeeded in achieving high levels of renewable installed capacity. However, these incentives have not been responsive to market conditions or price signals, imposing in some cases a great financial burden on consumers when Renewable Energy Sources reached significant levels. A way out of this problem could be a market mechanism where incentives respond to the level of investment on renewables. We explore this issue comparing a regulatory system based on Tradable Green Certificates, able to react to market changes, to a Feed-in-Tariffs incentive scheme. We model the strategic interaction between participants in the electricity pool and the Tradable Green Certificates market and focus on the optimal regulation for the retailer segment, which generates the desired demand for green certificates as a decreasing function of the certificate price. We then calibrate our theoretical model with data from the Spanish electricity system for the period 2008–2013. Simulations show that a green certificate scheme could both achieve the 2020 targets for renewable electricity and reduce regulatory costs. However, the role of regulators is still important, since setting the right target for renewable electricity affects the cost burden of the system.     

Influence of UK energy policy on the deployment of anaerobic digestion

Anaerobic digestion (AD) has the potential to contribute to greenhouse gas emissions reductions, improve energy security, increase generation of decentralised renewable electrical and thermal energy, produce low-impact fertiliser and enhance adherence to the principles of proximity as well as self-sufficiency in waste treatment, in energy generation and in resource use. Financial viability is scrutinised investigating optimal logistic pre-conditions such as catchment area or plant size. Given that a breakthrough in deployment does not only depend on technical aspects, the relative importance and magnitude of the necessary incentives is discussed. The influence of policy instruments is studied by devising different incentive scenarios for the United Kingdom. Substantial and predictable rewards for renewable electricity and heat are essential to harness the full potential of AD in addition to the current emphasis on landfill tax. A possible configuration of energy supply companies as a crucial vehicle to bring anaerobic digestion to market is highlighted.     

Economic analysis of renewable heat and electricity production by sewage sludge digestion—a case study

In this paper, we assess the total cost of energy recovery from sewage sludge through anaerobic digestion with biogas utilization in combined heat and power (CHP) system. The important advantage of anaerobic digestion process is the production of biogas, which can be used to generate electricity and heat as a source of renewable energy. From this study, it can be retained that the generated thermal energy from the anaerobic digestion process meets the needs of the wastewater treatment plant (WWTP) and guarantees its self‐sufficiency in heat. The surplus of renewable heat produced by CHP is not a primary factor to improve the economic viability of the process. Moreover, the sales of electricity output represent about 76% of the operating costs of anaerobic digestion process. Renewable energy production is not economically viable by its own, without considering the wastewater treatment function and the associated incomes. Nevertheless, sludge digestion helps to reduce the wastewater treatment costs mainly by giving a good source of revenue via electricity production. Copyright © 2014 John Wiley & Sons, Ltd.     

德国银行可再生能源投融资模式研究

德国是全球可再生能源发展的领头羊,良好的投融资机制和模式是德国可再生能源发展的重要支撑力量.在法律框架的支持下,德国政策性银行和商业性银行已形成互补、合作的商业运作模式和合作关系,共同构建了良好的可再生能源投融资环境.本文研究分析了德国政策性银行和商业性银行的地位和作用、以及可再生能源投融资服务的种类,提出了促进我国可再生能源投融资发展的启示和建议.     

Financial measures by the state for the enhanced deployment of renewable energies

The character of barriers in the way of faster market penetration by renewable energy suggests a need for a broad package of financial and non-financial political steps and measures. The financial measures presently form the backbone of all policies to assist renewable energies in the market. Experience gained with measures in Germany such as operating and investment cost grants, favorable loans and tax relief are manifold and could be of interest to other nations, especially since the most important market barrier, i.e. the lack of competitiveness against conventional technologies (except in certain niches), is typical for most countries. Their manner of application and their effects vary greatly, therefore offering the opportunity to select and employ them in keeping with the different technologies and the respective situation in each country.     

Rewarding energy savings rather than energy efficiency: Exploring the concept of a feed-in tariff for energy savings

Financial incentives are important for overcoming certain market barriers to improved energy efficiency and for the adoption of energy efficient technologies. Financial incentives are mainly focused on the introduction of specific technologies, rather than behavioural change. While the declared goal of financial support schemes very often is to save energy or reduce harmful emissions rather than to foster new technologies per se, it is often encountered that such financial support for energy efficient technologies may not ensure real energy savings due to the rebound effect and various market barriers.In the area of renewable energies it is common for financial support to be given to power producers for the verified production of renewable electricity, in the form of a guaranteed financial incentive (feed-in tariff). In the energy efficiency policy research little attention has been paid to the possible use of a “feed-in tariff” in the form of a financial incentive based on the kWh saved by the end-user. This paper discusses the possible setup of a feed-in tariff designed to reward energy savings.     

Photovoltaic remuneration policies in the European Union

The purpose of this paper is to study the development of photovoltaic (PV) systems in some countries of the European Union (EU). We establish the stage of development of each country, their short- and long-term degree of compliance and the trends of international investors favouring one market or another. EU countries employ four major types of programs to encourage PV use: (1) feed in tariffs (FIT), (2) green certificates with a quota system, (3) investment and tax incentives, and (4) bids on the quota system. The FIT is the most widely used program to create incentives for the use of PV systems. During the past two years, PV tariffs have been reduced in many European countries. Investments in PV are still attractive, in some cases even overly generous with respect to the financial landscape in the world.This paper shows, for each country, the type of incentive and the trends in and forecast for installed capacity and calculates the internal rate of return (IRR) for investment in grid-connected PV systems.     

Economic implications of thermal energy storage for concentrated solar thermal power

Solar energy is an attractive renewable energy source because the sun's energy is plentiful and carbon-free. However, solar energy is intermittent and not suitable for base load electricity generation without an energy backup system. Concentrated solar power (CSP) is unique among other renewable energy options because it can approach base load generation with molten salt thermal energy storage (TES). This paper describes the development of an engineering economic model that directly compares the performance, cost, and profit of a 110-MW parabolic trough CSP plant operating with a TES system, natural gas-fired backup system, and no backup system. Model results are presented for 0–12 h backup capacities with and without current U.S. subsidies. TES increased the annual capacity factor from around 30% with no backup to up to 55% with 12 h of storage when the solar field area was selected to provide the lowest levelized cost of energy (LCOE). Using TES instead of a natural gas-fired heat transfer fluid heater (NG) increased total plant capital costs but decreased annual operation and maintenance costs. These three effects led to an increase in the LCOE for PT plants with TES and NG backup compared with no backup. LCOE increased with increasing backup capacity for plants with TES and NG backup. For small backup capacities (1–4 h), plants with TES had slightly lower LCOE values than plants with NG backup. For larger backup capacities (5–12 h), plants with TES had slightly higher LCOE values than plants with NG backup. At these costs, current U.S. federal tax incentives were not sufficient to make PT profitable in a market with variable electricity pricing. Current U.S. incentives combined with a fixed electricity price of $200/MWh made PT plants with larger backup capacities more profitable than PT plants with no backup or with smaller backup capacities. In the absence of incentives, a carbon price of $100–$160/tonne CO_2eq would be required for these PT plants to compete with new coal-fired power plants in the U.S. If the long-term goal is to increase renewable base load electricity generation, additional incentives are needed to encourage new CSP plants to use thermal energy storage in the U.S.     

An energy pricing scheme for the diffusion of decentralized renewable technology investment in developing countries

The purpose of this paper is to investigate price support for market penetration of renewable energy in developing nations through a decentralized supply process. We integrate the new decentralized energy support: renewable premium tariff, to analyze impacts of tariff incentives on the diffusion of renewable technology in Senegal. Based on photovoltaic and wind technologies and an assessment of renewable energy resources in Senegal, an optimization technique is combined with a cash flow analysis to investigate investment decisions in renewable energy sector. Our findings indicate that this support mechanism could strengthen the sustainable deployment of renewable energy in remote areas of Senegal. Although different payoffs emerged, profits associated with a renewable premium tariff are the highest among the set of existing payoffs. Moreover in analyzing impacts of price incentives on social welfare, we show that price tariffing schemes must be strategically scrutinized in order to minimize welfare loss associated with price incentives. Finally we argue that a sustainable promotion of incentive mechanisms supporting deployment of renewable technology in developing nations should be carried out under reliable institutional structures. The additional advantage of the proposed methodology is its ability to integrate different stakeholders (producers, investors and consumers) in the planning process.     

Optimization of use of waste in the future energy system

Alternative uses of waste for energy production become increasingly interesting when considered from two perspectives, that of waste management and the energy system perspective. This paper presents the results of an enquiry into the use of waste in a future energy system. The analysis was performed using the energy system analysis model, Balmorel. The study is focused on Germany and the Nordic countries and demonstrates the optimization of both investments and production within the energy systems. The results present cost optimization excluding taxation concerning the use of waste for energy production in Denmark in a 2025 scenario with 48% renewable energy. Investments in a range of waste conversion technologies are facilitated, including waste incineration, co-combustion with coal, anaerobic digestion, and gasification. The most economically feasible solutions are found to be incineration of mixed waste, anaerobic digestion of organic waste, and gasification of part of the potential RDF (refuse derived fuel) for CHP (combined heat and power) production, while the remaining part is co-combusted with coal. Co-combustion mainly takes place in new coal-fired power plants, allowing investments to increase in comparison with a situation where only investments in waste incineration are allowed.     

Where AD plants wildly grow: The spatio-temporal diffusion of agricultural biogas production in the Czech Republic

There is fundamental agreement about the environmental benefits of renewable energy technologies, but unintended consequences arising from their deployment are frequent sources of conflicts. The Czech Republic has committed itself to supply 13.5% of its electricity consumption from renewable sources by 2020. High state incentives for renewable energies have been provided to achieve this target, however critical questions can be asked about the appropriateness of the design of the supporting frameworks which caused a boom in photo-voltaic (PV) installations on agricultural land, as well as a boom in the installation of agricultural anaerobic digestion (AD) plants fuelled by dedicated energy crops. This paper analyses the diffusion of agricultural AD plants in the Czech Republic, focusing especially on locational characteristics in relation to the quality of agricultural land, agricultural and population census data. Statistical analysis of those spatial datasets show that agricultural AD plants are mostly located in less favourable agricultural areas, in regions having recently experienced a reduction in cattle breeding, and in regions with significant increases of sowing areas of green maize. These findings suggests shortcomings in the supporting policy for AD plants in the Czech Republic, resulting in unintended environmental consequences, and missed opportunities to enhance energy self-sufficiency and resilience in the countryside.     

How to stimulate renewable energy power generation effectively? – China's incentive approaches and lessons

The renewable energy power generation (REPG) in China has experienced tremendous growth in the last decade. To understand this rapid growth, it is necessary to explore how Chinese government triggers the remarkable development of the industry. This paper offers a systematic analysis of the incentive policy system for REPG in China, covering wind power, solar photovoltaic, small hydropower (single-unit power generation capacity less than 50 MW), biomass power and geothermal power. The incentive system contains laws, regulations, policies and industrial plans issued during the 11th and 12th “Five-year Plan” periods (2006–2015). Four major incentive strategies of the Chinese government are identified: research and development incentives, fiscal and tax incentives, grid-connection and tariff incentives, and market development incentives. The results show these incentive methods have played a significant role in promoting the development of REPG in China, but still there are some problems associated with them. International comparisons of the incentive policies with those of Denmark, Germany and US, as well as the strategies to further improve the Chinese incentive approaches are discussed. This comprehensive analysis of China's incentive policy system for REPG helps to understand China's experience in promoting renewable energy, contributing to better decision-making in policy.     

Nonmarket cobenefits and economic feasibility of on-farm biogas energy production

Standard analysis of the economic feasibility of on-farm biogas energy production tend to emphasize primarily on direct financial benefits to farmers, and abstracts from the nonmarket cobenefits associated with anaerobic digestion of livestock manure and other biomass feedstock. This shortcoming of the standard feasibility analysis raises a fundamental question: How is the economic feasibility of on-farm anaerobic biogas energy production affected by the associated nonpecuniary cobenefits? Incorporating key nonmarket cobenefits from biogas energy production extends the standard economic feasibility analysis, and provides important insights. When nonmarket cobenefits were excluded, on-farm biogas energy production was generally not financially feasible for the dairy and swine farm size ranges studied (except for 600- and 800-sow farms). Overall, results of the financial feasibility analysis did not change compared to a base scenario (without nonmarket cobenefits) when an estimated annual total nonmarket cobenefits of CND$5000 was incorporated into the analysis, for both dairy and swine farms. Biogas energy production was generally financially viable for small-size dairy (i.e., 50-cow) and swine (i.e., 200-sow) farms when the nonmarket cobenefits were valued at CND$15,000 (or higher). Improvements in financial feasibility were more dramatic for dairy than for swine farms.     

全球太阳能热利用行业激励政策及对我国的启示

太阳能热利用是一种重要的可再生能源,在我国已经实现了商业化运行。如何支持已实现了商业化运行的太阳能热利用行业,是目前可再生能源政策研究的热点问题。本文研究分析了立法、财政补贴和间接市场等激励政策的适用环境,剖析了欧盟、西班牙、以色列和澳大利亚等国家和地区的现行激励政策,针对我国的产业发展现状,提出了相应的政策建议。     

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.     

Designing effective and efficient incentive policies for renewable energy in generation expansion planning

We present a bilevel optimization approach to designing effective and efficient incentive policies for stimulating investment in renewable energy. The effectiveness of an incentive policy is its capability to achieve a goal that would not be achievable without it. Renewable portfolio standards are used in this paper as the policy goal. The efficiency of an incentive policy is measured by the amount of policy intervention, such as taxes collected or subsidies paid, to achieve the policy goal. We obtain the most effective and efficient incentive policies in the context of generation expansion planning, in which a centralized planner makes investment decisions for the energy system to serve projected demand of electricity. A case study is conducted on integrated coal transportation and electricity transmission networks representing the contiguous United States. The numerical analysis from the case study provides insights on the comparison of various incentive policies. The sensitivity of the incentive policies with respect to coal production cost, wind energy investment cost, and transmission capacity is also studied.