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Deployment of renewable energy: Economic effects on the Croatian economy

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  • Keček, Damira
  • Mikulić, Davor
  • Lovrinčević, Željko

Abstract

Energy strategy of the European Union and Croatia specify the focus on generating energy from renewable sources as an important basis for achieving sustainable development. The aim of the paper is to quantify economic effects of the renewable energy sources plants deployment in Croatia. Indirect and induced effects of deploying and operating such plants have been quantified based on an input-output model. Whereas the open input-output model quantifies indirect effects, the model closed by individual consumption additionally includes induced effects related to the increase in income of the household sector. The total effects have been quantified separately for the investment channel and the channel of intermediate consumption. The results indicate that there are positive multiplicative effects related to the deployment and operation of the plants based on renewable sources in Croatia. The same amount of investments results in the highest gross value added and employment for smaller hydropower plants and biogas, whereas multiplicative effects of the wind power plants are lower due to the high share of imported equipment. The policy of fostering renewable sources will potentially have more intensive effects on the national economy if the energy and industrial strategy are better harmonised in the future.

Suggested Citation

  • Keček, Damira & Mikulić, Davor & Lovrinčević, Željko, 2019. "Deployment of renewable energy: Economic effects on the Croatian economy," Energy Policy, Elsevier, vol. 126(C), pages 402-410.
    • Handle: RePEc:eee:enepol:v:126:y:2019:i:c:p:402-410
    DOI: 10.1016/j.enpol.2018.11.028
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