Effects of coordinating support policy changes on renewable power investor choices in Europe
Melliger M, Lilliestam J (2021)
Publication Type: Journal article
Publication year: 2021
Journal
Book Volume: 148
Article Number: 111993
DOI: 10.1016/j.enpol.2020.111993
Abstract
The economic context for renewable power in Europe is shifting: feed-in tariffs are replaced by auctioned premiums as the main support schemes. As renewables approach competitiveness, political pressure mounts to phase out support, whereas some other actors perceive a need for continued fixed-price support. We investigate how the phase-out of support or the reintroduction of feed-in tariffs would affect investors’ choices for renewables through a conjoint analysis. In particular, we analyse the impact of coordination – the simultaneousness – of policy changes across countries and technologies. We find that investment choices are not strongly affected if policy changes are coordinated and returns unaffected. However, if policy changes are uncoordinated, investments shift to still supported – less mature and costlier – technologies or countries where support remains or is reintroduced. This shift is particularly strong for large investors and could potentially skew the European power mix towards an over-reliance on a single, less mature technology or specific generation region, resulting in a more expensive power system. If European countries want to change their renewable power support policies, and especially if they phase out support and expose renewables to market competition, it is important that they coordinate their actions.
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Germany (DE)How to cite
APA:
Melliger, M., & Lilliestam, J. (2021). Effects of coordinating support policy changes on renewable power investor choices in Europe. Energy Policy, 148. https://doi.org/10.1016/j.enpol.2020.111993
MLA:
Melliger, Marc, and Johan Lilliestam. "Effects of coordinating support policy changes on renewable power investor choices in Europe." Energy Policy 148 (2021).
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