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Targeted Support for New Photovoltaic Installations Requires Flexible and Regular Adjustments

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  • Thilo Grau

Abstract

Feed-in tariffs have proven to be an effective instrument in supporting renewable energies. As a result of the dynamic price trend of photovoltaics, the actual number of systems installed has repeatedly exceeded initial government targets. Therefore, the support for new solar power installations by the German Renewable Energy Sources Act (EEG) has been adjusted several times. Based on the experiences with these adjustments, DIW Berlin analyzed how feed-in tariffs can also be used to meet specific installation targets. For photovoltaic (PV) systems of up to 30 kW, a model analysis indicates that a bimonthly adjustment of the tariffs for new systems, on the basis of installation volume, is a more effective instrument for achieving targets than the biannual mechanism employed to date.

Suggested Citation

  • Thilo Grau, 2012. "Targeted Support for New Photovoltaic Installations Requires Flexible and Regular Adjustments," DIW Economic Bulletin, DIW Berlin, German Institute for Economic Research, vol. 2(6), pages 11-15.
  • Handle: RePEc:diw:diwdeb:2012-6-3
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    File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.401748.de/diw_econ_bull_2012-06-3.pdf
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    More about this item

    Keywords

    Feed-in tariff; photovoltaic; renewable energy;

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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