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Revisiting Germanyùs solar cell promotion: An unfolding disaster

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  • Manuel Frondel
  • Christoph M. Schmidt
  • Colin Vance

Abstract

This article revisits an analysis by Frondel et al. (2008) on the promotion of photovoltaics (PV) in Germany, a technology that enjoys particularly high subsidies in the form of feed-in tariffs. The result is explosive costs with little to show for either environmental or employment benefits. Indeed, we document that the immense costs foreseen by Frondel and colleagues have materialized: our updated estimate of the subsidies for PV, at Ì 108 Bn, even exceeds their expectations. Moreover, with installed PV capacities growing at a rapid rate, these costs will continue to accumulate, diverting resources from more cost-effective climate protection instruments.

Suggested Citation

  • Manuel Frondel & Christoph M. Schmidt & Colin Vance, 2014. "Revisiting Germanyùs solar cell promotion: An unfolding disaster," Economic Analysis and Policy, Elsevier, vol. 44(1), pages 3-13.
  • Handle: RePEc:eee:ecanpo:v:44:y:2014:i:1:p:3-13
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