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What drives renewable energy development?

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Listed:
  • Alagappan, L.
  • Orans, R.
  • Woo, C.K.

Abstract

This viewpoint reviews renewable energy development in 14 markets that differ in market structure (restructured vs. not restructured), use of feed-in-tariff (FIT) (yes vs. no), transmission planning (anticipatory vs. reactive), and transmission interconnection cost allocated to a renewable generator (high vs. low). We find that market restructuring is not a primary driver of renewable energy development. Renewable generation has the highest percent of total installed capacity in markets that use a FIT, employ anticipatory transmission planning, and have loads or end-users paying for most, if not all, of the transmission interconnection costs. In contrast, renewable developers have been less successful in markets that do not use a FIT, employ reactive transmission planning, and have generators paying for most, if not all, of the transmission interconnection costs. While these policies can lead to higher penetration of renewable energy in the short run, their high cost to ratepayers can threaten the economic sustainability of renewable energy in the long-run.

Suggested Citation

  • Alagappan, L. & Orans, R. & Woo, C.K., 2011. "What drives renewable energy development?," Energy Policy, Elsevier, vol. 39(9), pages 5099-5104, September.
  • Handle: RePEc:eee:enepol:v:39:y:2011:i:9:p:5099-5104
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    References listed on IDEAS

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    2. Scholtens, Bert & Veldhuis, Rineke, 2015. "How does the development of the financial industry advance renewable energy? A panel regression study of 198 countries over three decades," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113114, Verein für Socialpolitik / German Economic Association.
    3. Chi-Keung Woo, Ira Horowitz, Brian Horii, Ren Orans, and Jay Zarnikau, 2012. "Blowing in the Wind: Vanishing Payoffs of a Tolling Agreement for Natural-gas-fired Generation of Electricity in Texas," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
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    8. Woo, C.K. & Sreedharan, P. & Hargreaves, J. & Kahrl, F. & Wang, J. & Horowitz, I., 2014. "A review of electricity product differentiation," Applied Energy, Elsevier, vol. 114(C), pages 262-272.
    9. Clodnițchi Roxana & Chinie Alexandra Cătălina, 2015. "Factors of impact on the evolution of electricity markets from renewable energy sources: a comparison between Romania and Germany," Management & Marketing, De Gruyter Open, vol. 10(1), pages 34-52, June.
    10. repec:eee:appene:v:204:y:2017:i:c:p:531-543 is not listed on IDEAS
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    13. Gillenwater, Michael, 2013. "Probabilistic decision model of wind power investment and influence of green power market," Energy Policy, Elsevier, vol. 63(C), pages 1111-1125.
    14. Woo, C.K. & Li, R. & Shiu, A. & Horowitz, I., 2013. "Residential winter kWh responsiveness under optional time-varying pricing in British Columbia," Applied Energy, Elsevier, vol. 108(C), pages 288-297.
    15. Jeffers, Robert F. & Jacobson, Jacob J. & Searcy, Erin M., 2013. "Dynamic analysis of policy drivers for bioenergy commodity markets," Energy Policy, Elsevier, vol. 52(C), pages 249-263.
    16. Woo, C.K. & Ho, T. & Zarnikau, J. & Olson, A. & Jones, R. & Chait, M. & Horowitz, I. & Wang, J., 2014. "Electricity-market price and nuclear power plant shutdown: Evidence from California," Energy Policy, Elsevier, vol. 73(C), pages 234-244.
    17. Gireesh Shrimali & Steffen Jenner & Felix Groba & Gabriel Chan & Joe Indvik, 2012. "Have State Renewable Portfolio Standards Really Worked?: Synthesizing Past Policy Assessments," Discussion Papers of DIW Berlin 1258, DIW Berlin, German Institute for Economic Research.
    18. Woo, C.K. & Moore, J. & Schneiderman, B. & Ho, T. & Olson, A. & Alagappan, L. & Chawla, K. & Toyama, N. & Zarnikau, J., 2016. "Merit-order effects of renewable energy and price divergence in California’s day-ahead and real-time electricity markets," Energy Policy, Elsevier, vol. 92(C), pages 299-312.
    19. Chi-Keung Woo, Ira Horowitz, Jay Zarnikau, Jack Moore, Brendan Schneiderman, Tony Ho, and Eric Leung, 2016. "What Moves the Ex Post Variable Profit of Natural-Gas-Fired Generation in California?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    20. Sreedharan, P. & Farbes, J. & Cutter, E. & Woo, C.K. & Wang, J., 2016. "Microgrid and renewable generation integration: University of California, San Diego," Applied Energy, Elsevier, vol. 169(C), pages 709-720.
    21. Sung-Lin Hsueh, 2012. "A Fuzzy Utility-Based Multi-Criteria Model for Evaluating Households’ Energy Conservation Performance: A Taiwanese Case Study," Energies, MDPI, Open Access Journal, vol. 5(8), pages 1-17, August.
    22. Lam, J.C.K. & Woo, C.K. & Kahrl, F. & Yu, W.K., 2013. "What moves wind energy development in China? Show me the money!," Applied Energy, Elsevier, vol. 105(C), pages 423-429.
    23. Smith, William J., 2013. "Projecting EU demand for natural gas to 2030: A meta-analysis," Energy Policy, Elsevier, vol. 58(C), pages 163-176.
    24. Holburn, Guy L.F., 2012. "Assessing and managing regulatory risk in renewable energy: Contrasts between Canada and the United States," Energy Policy, Elsevier, vol. 45(C), pages 654-665.

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