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Feed-in tariffs for photovoltaics: Learning by doing in Germany?

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  • Wand, Robert
  • Leuthold, Florian

Abstract

This paper examines the potential effects of Germany’s feed-in tariff policy for small roof-top solar PV systems installed between 2009 and 2030. Employing a partial equilibrium approach, we evaluate the policy by weighing the benefits from induced learning and avoided environmental externalities against the social costs of promoting residential PV. We use a dynamic optimization model that maximizes social welfare by accounting for learning-by-doing, technology diffusion, and yield-dependent demand. We find a wide range of effects on welfare, from net social costs of 2014million€ under a “business as usual” scenario to 7586million€ of net benefits under the positive prospects of PV’s development. Whereas the “business as usual” scenario underestimates actual price reductions, the positive scenario mirrors recent price developments and feed-in tariffs in the German residential PV market.

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  • Wand, Robert & Leuthold, Florian, 2011. "Feed-in tariffs for photovoltaics: Learning by doing in Germany?," Applied Energy, Elsevier, vol. 88(12), pages 4387-4399.
    • Handle: RePEc:eee:appene:v:88:y:2011:i:12:p:4387-4399
    DOI: 10.1016/j.apenergy.2011.05.015
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