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Subsidizing renewables as part of taking leadership in international climate policy: The German case

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  • Buchholz, Wolfgang
  • Dippl, Lisa
  • Eichenseer, Michael

Abstract

Leadership in Climate Policy is usually associated with leading by example in mitigation efforts whereas little attention has been paid to leadership in climate-friendly technological progress. We point out that pioneering activities that create reliable demand such as Germany's feed-in tariff for solar energy constitute such technological leadership. Based on global learning curves, we argue that the enormous reduction of prices for photovoltaic modules is due to demand side interventions like Germany's EEG and related international technology diffusion and policy transfer, especially to China. For the German case, we calculate that the costs of incentivizing this technological progress through the EEG add up to a range between 112.34 and 122.18 Bn Euro (based on a thought experiment of a hypothetical new entrant in 2014).

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  • Buchholz, Wolfgang & Dippl, Lisa & Eichenseer, Michael, 2019. "Subsidizing renewables as part of taking leadership in international climate policy: The German case," Energy Policy, Elsevier, vol. 129(C), pages 765-773.
    • Handle: RePEc:eee:enepol:v:129:y:2019:i:c:p:765-773
    DOI: 10.1016/j.enpol.2019.02.044
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    Citations

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    Cited by:

    1. Liu, Diyi & Zou, Hongyang & Qiu, Yueming & Du, Huibin, 2024. "Consumer reaction to green subsidy phase-out in China: Evidence from the household photovoltaic industry," Energy Economics, Elsevier, vol. 129(C).
    2. Shengqing Xu, 2023. "China’s climate governance for carbon neutrality: regulatory gaps and the ways forward," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-10, December.
    3. Kristina Govorukha & Philip Mayer & Dirk Rübbelke, 2021. "Fragmented Landscape of European Policies in the Energy Sector: First-Mover Advantages," CESifo Working Paper Series 9093, CESifo.
    4. Zofia Gródek-Szostak & Małgorzata Luc & Anna Szeląg-Sikora & Jakub Sikora & Marcin Niemiec & Luis Ochoa Siguencia & Emil Velinov, 2020. "Promotion of RES in a Technology Transfer Network. Case Study of the Enterprise Europe Network," Energies, MDPI, vol. 13(13), pages 1-13, July.
    5. Gaoyuan Xu & Xiaojing Wang, 2022. "Research on the Electricity Market Clearing Model for Renewable Energy," Energies, MDPI, vol. 15(23), pages 1-16, December.
    6. Lars Mewes & Leonie Tuitjer & Peter Dirksmeier, 2024. "Exploring the variances of climate change opinions in Germany at a fine-grained local scale," Nature Communications, Nature, vol. 15(1), pages 1-14, December.
    7. Nuñez-Jimenez, Alejandro & Knoeri, Christof & Hoppmann, Joern & Hoffmann, Volker H., 2022. "Beyond innovation and deployment: Modeling the impact of technology-push and demand-pull policies in Germany's solar policy mix," Research Policy, Elsevier, vol. 51(10).

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    More about this item

    Keywords

    Leadership; Climate change; Solar photovoltaic; Subsidies; Feed-intariffs; Ambition;
    All these keywords.

    JEL classification:

    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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