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Financial return for government support of large-scale thin-film solar photovoltaic manufacturing in Canada

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  • K. Branker

    (Queen's University [Kingston, Canada])

  • J.M. Pearce

    (MTU - Michigan Technological University)

Abstract

As the Ontario government has recognized that solar photovoltaic (PV) energy conversion is a solution to satisfying society's energy demands while reducing the adverse anthropogenic impacts on the global environment that compromise social welfare, they have begun to generate policy and funding programs to support financial incentives for PV. This paper provides a financial analysis for investment in a 1 GW per year turnkey amorphous silicon PV manufacturing plant. The financial benefits for both the provincial and federal governments were quantified for: i) full construction subsidy, ii) construction subsidy and sale, iii) partially subsidize construction, iv) a publicly owned plant, v) loan guarantee for construction, and vi) an income tax holiday. Revenues for the governments are derived from: taxation (personal, corporate, and sales), sales of panels in Ontario, and saved health, environmental and economic costs associated with offsetting coal-fired electricity. Both governments enjoyed positive cash flows from these investments in less than 12 years and in many of the scenarios both governments earned well over 8% on investments from 100s of millions to $2.4 billion. The results showed that it is in the financial best interest of both the Ontario and Canadian federal governments to implement aggressive fiscal policy to support large-scale PV manufacturing.

Suggested Citation

  • K. Branker & J.M. Pearce, 2010. "Financial return for government support of large-scale thin-film solar photovoltaic manufacturing in Canada," Post-Print hal-02120501, HAL.
    • Handle: RePEc:hal:journl:hal-02120501
    DOI: 10.1016/j.enpol.2010.03.058
    Note: View the original document on HAL open archive server: https://hal.science/hal-02120501
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    Cited by:

    1. Solangi, K.H. & Islam, M.R. & Saidur, R. & Rahim, N.A. & Fayaz, H., 2011. "A review on global solar energy policy," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(4), pages 2149-2163, May.
    2. Mabee, Warren E. & Mannion, Justine & Carpenter, Tom, 2012. "Comparing the feed-in tariff incentives for renewable electricity in Ontario and Germany," Energy Policy, Elsevier, vol. 40(C), pages 480-489.
    3. Wadhawan, Siddharth R. & Pearce, Joshua M., 2017. "Power and energy potential of mass-scale photovoltaic noise barrier deployment: A case study for the U.S," Renewable and Sustainable Energy Reviews, Elsevier, vol. 80(C), pages 125-132.
    4. Zelenika-Zovko, I. & Pearce, J.M., 2011. "Diverting indirect subsidies from the nuclear industry to the photovoltaic industry: Energy and financial returns," Energy Policy, Elsevier, vol. 39(5), pages 2626-2632, May.
    5. La Gennusa, Maria & Lascari, Giovanni & Rizzo, Gianfranco & Scaccianoce, Gianluca & Sorrentino, Giancarlo, 2011. "A model for predicting the potential diffusion of solar energy systems in complex urban environments," Energy Policy, Elsevier, vol. 39(9), pages 5335-5343, September.
    6. Nosrat, Amir H. & Swan, Lukas G. & Pearce, Joshua M., 2013. "Improved performance of hybrid photovoltaic-trigeneration systems over photovoltaic-cogen systems including effects of battery storage," Energy, Elsevier, vol. 49(C), pages 366-374.
    7. Alafita, T. & Pearce, J.M., 2014. "Securitization of residential solar photovoltaic assets: Costs, risks and uncertainty," Energy Policy, Elsevier, vol. 67(C), pages 488-498.
    8. McDonald, N.C. & Pearce, J.M., 2010. "Producer responsibility and recycling solar photovoltaic modules," Energy Policy, Elsevier, vol. 38(11), pages 7041-7047, November.
    9. Sueyoshi, Toshiyuki & Goto, Mika, 2017. "Measurement of returns to scale on large photovoltaic power stations in the United States and Germany," Energy Economics, Elsevier, vol. 64(C), pages 306-320.
    10. Kantamneni, Abhilash & Winkler, Richelle & Gauchia, Lucia & Pearce, Joshua M., 2016. "Emerging economic viability of grid defection in a northern climate using solar hybrid systems," Energy Policy, Elsevier, vol. 95(C), pages 378-389.
    11. Chiara Modanese & Hannu S. Laine & Toni P. Pasanen & Hele Savin & Joshua M. Pearce, 2018. "Economic Advantages of Dry-Etched Black Silicon in Passivated Emitter Rear Cell (PERC) Photovoltaic Manufacturing," Energies, MDPI, vol. 11(9), pages 1-18, September.
    12. Branker, K. & Pearce, J.M., 2010. "Financial return for government support of large-scale thin-film solar photovoltaic manufacturing in Canada," Energy Policy, Elsevier, vol. 38(8), pages 4291-4303, August.
    13. Mundada, Aishwarya S. & Shah, Kunal K. & Pearce, J.M., 2016. "Levelized cost of electricity for solar photovoltaic, battery and cogen hybrid systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 692-703.
    14. Kumar, Rakesh & Rosen, Marc A., 2011. "A critical review of photovoltaic–thermal solar collectors for air heating," Applied Energy, Elsevier, vol. 88(11), pages 3603-3614.
    15. Jordehi, A. Rezaee, 2016. "Parameter estimation of solar photovoltaic (PV) cells: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 354-371.
    16. Branker, K. & Pathak, M.J.M. & Pearce, J.M., 2011. "A review of solar photovoltaic levelized cost of electricity," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(9), pages 4470-4482.
    17. Thi Thu Em Vo & Hyeyoung Ko & Jun-Ho Huh & Namje Park, 2021. "Overview of Solar Energy for Aquaculture: The Potential and Future Trends," Energies, MDPI, vol. 14(21), pages 1-20, October.
    18. Sueyoshi, Toshiyuki & Goto, Mika, 2014. "Photovoltaic power stations in Germany and the United States: A comparative study by data envelopment analysis," Energy Economics, Elsevier, vol. 42(C), pages 271-288.

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