IDEAS home Printed from https://ideas.repec.org/a/eee/juipol/v80y2023ics0957178722001400.html
   My bibliography  Save this article

Impact of Spanish renewable support scheme reforms on the revenues of photovoltaic power plants

Author

Listed:
  • Castro-Rodríguez, Fidel
  • Miles-Touya, Daniel

Abstract

In this paper, we study the impact of the 2013 reform of the Spanish support scheme for renewable on the revenues of photovoltaic plants of small investors. We break down the revenue change into two sources. The first lies in the difference between the payment per unit of electricity that the plant received under the new scheme and what it would have received under the original scheme. We show that this change depended on plant productivity. The second lies in the revenue forecast bias made by small investors when evaluating investment projects. This revenue bias may help to explain some of the liquidity claims raised by these producers in the aftermath of the remuneration scheme modification.

Suggested Citation

  • Castro-Rodríguez, Fidel & Miles-Touya, Daniel, 2023. "Impact of Spanish renewable support scheme reforms on the revenues of photovoltaic power plants," Utilities Policy, Elsevier, vol. 80(C).
    • Handle: RePEc:eee:juipol:v:80:y:2023:i:c:s0957178722001400
    DOI: 10.1016/j.jup.2022.101476
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0957178722001400
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jup.2022.101476?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Mir-Artigues, Pere & Cerdá, Emilio & del Río, Pablo, 2018. "Analysing the economic impact of the new renewable electricity support scheme on solar PV plants in Spain," Energy Policy, Elsevier, vol. 114(C), pages 323-331.
    2. Ibarloza, Ander & Heras-Saizarbitoria, Iñaki & Allur, Erlantz & Larrea, Ainara, 2018. "Regulatory cuts and economic and financial performance of Spanish solar power companies: An empirical review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 92(C), pages 784-793.
    3. Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-329, May.
    4. Talavera, D.L. & Muñoz-Cerón, E. & Ferrer-Rodríguez, J.P. & Nofuentes, G., 2016. "Evolution of the cost and economic profitability of grid-connected PV investments in Spain: Long-term review according to the different regulatory frameworks approved," Renewable and Sustainable Energy Reviews, Elsevier, vol. 66(C), pages 233-247.
    5. Lomas, J.C. & Muñoz-Cerón, E. & Nofuentes, G. & de la Casa, J., 2018. "Sale of profitable but unaffordable PV plants in Spain: Analysis of a real case," Energy Policy, Elsevier, vol. 117(C), pages 279-294.
    6. de la Hoz, Jordi & Martín, Helena & Miret, Jaume & Castilla, Miguel & Guzman, Ramon, 2016. "Evaluating the 2014 retroactive regulatory framework applied to the grid connected PV systems in Spain," Applied Energy, Elsevier, vol. 170(C), pages 329-344.
    7. Abarbanell, Jeffery S. & Lanen, William N. & Verrecchia, Robert E., 1995. "Analysts' forecasts as proxies for investor beliefs in empirical research," Journal of Accounting and Economics, Elsevier, vol. 20(1), pages 31-60, July.
    8. Sendstad, Lars H. & Hagspiel, Verena & Mikkelsen, Wilhelm Jebsen & Ravndal, Ruben & Tveitstøl, Martin, 2022. "The impact of subsidy retraction on European renewable energy investments," Energy Policy, Elsevier, vol. 160(C).
    9. Boomsma, Trine Krogh & Linnerud, Kristin, 2015. "Market and policy risk under different renewable electricity support schemes," Energy, Elsevier, vol. 89(C), pages 435-448.
    10. López Prol, Javier, 2018. "Regulation, profitability and diffusion of photovoltaic grid-connected systems: A comparative analysis of Germany and Spain," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 1170-1181.
    11. Mir-Artigues, Pere & Cerdá, Emilio & del Río, Pablo, 2015. "Analyzing the impact of cost-containment mechanisms on the profitability of solar PV plants in Spain," Renewable and Sustainable Energy Reviews, Elsevier, vol. 46(C), pages 166-177.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sergio Coronas & Jordi de la Hoz & Àlex Alonso & Helena Martín, 2022. "23 Years of Development of the Solar Power Generation Sector in Spain: A Comprehensive Review of the Period 1998–2020 from a Regulatory Perspective," Energies, MDPI, vol. 15(4), pages 1-53, February.
    2. Espinoza, R. & Muñoz-Cerón, E. & Aguilera, J. & de la Casa, J., 2019. "Feasibility evaluation of residential photovoltaic self-consumption projects in Peru," Renewable Energy, Elsevier, vol. 136(C), pages 414-427.
    3. Patricia Blanco-Díez & Montserrat Díez-Mediavilla & Cristina Alonso-Tristán, 2020. "Review of the Legislative Framework for the Remuneration of Photovoltaic Production in Spain: A Case Study," Sustainability, MDPI, vol. 12(3), pages 1-16, February.
    4. Raquel Fernández-González & Andrés Suárez-García & Miguel Ángel Álvarez Feijoo & Elena Arce & Montserrat Díez-Mediavilla, 2020. "Spanish Photovoltaic Solar Energy: Institutional Change, Financial Effects, and the Business Sector," Sustainability, MDPI, vol. 12(5), pages 1-18, March.
    5. Muñoz-Cerón, E. & Lomas, J.C. & Aguilera, J. & de la Casa, J., 2018. "Influence of Operation and Maintenance expenditures in the feasibility of photovoltaic projects: The case of a tracking pv plant in Spain," Energy Policy, Elsevier, vol. 121(C), pages 506-518.
    6. López Prol, Javier & Steininger, Karl W., 2020. "Photovoltaic self-consumption is now profitable in Spain: Effects of the new regulation on prosumers’ internal rate of return," Energy Policy, Elsevier, vol. 146(C).
    7. Lomas, J.C. & Muñoz-Cerón, E. & Nofuentes, G. & de la Casa, J., 2018. "Sale of profitable but unaffordable PV plants in Spain: Analysis of a real case," Energy Policy, Elsevier, vol. 117(C), pages 279-294.
    8. Fernández-González, Raquel & Puime-Guillén, Félix & Panait, Mirela, 2022. "Multilevel governance, PV solar energy, and entrepreneurship: the generation of green hydrogen as a fuel of renewable origin," Utilities Policy, Elsevier, vol. 79(C).
    9. López Prol, Javier & Steininger, Karl W., 2017. "Photovoltaic self-consumption regulation in Spain: Profitability analysis and alternative regulation schemes," Energy Policy, Elsevier, vol. 108(C), pages 742-754.
    10. D. L. Talavera & E. Muñoz-Cerón & J. de la Casa & D. Lozano-Arjona & M. Theristis & P. J. Pérez-Higueras, 2019. "Complete Procedure for the Economic, Financial and Cost-Competitiveness of Photovoltaic Systems with Self-Consumption," Energies, MDPI, vol. 12(3), pages 1-22, January.
    11. Gómez-Calvet, Roberto & Martínez-Duart, José Manuel & Serrano-Calle, Silvia, 2019. "Current state and optimal development of the renewable electricity generation mix in Spain," Renewable Energy, Elsevier, vol. 135(C), pages 1108-1120.
    12. Oscar W Fitch-Roy & David Benson & Bridget Woodman, 2019. "Policy Instrument Supply and Demand: How the Renewable Electricity Auction Took over the World," Politics and Governance, Cogitatio Press, vol. 7(1), pages 81-91.
    13. Daniel Lugo-Laguna & Angel Arcos-Vargas & Fernando Nuñez-Hernandez, 2021. "A European Assessment of the Solar Energy Cost: Key Factors and Optimal Technology," Sustainability, MDPI, vol. 13(6), pages 1-25, March.
    14. López Prol, Javier, 2018. "Regulation, profitability and diffusion of photovoltaic grid-connected systems: A comparative analysis of Germany and Spain," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 1170-1181.
    15. Talavera, D.L. & Muñoz-Cerón, Emilio & Ferrer-Rodríguez, J.P. & Pérez-Higueras, Pedro J., 2019. "Assessment of cost-competitiveness and profitability of fixed and tracking photovoltaic systems: The case of five specific sites," Renewable Energy, Elsevier, vol. 134(C), pages 902-913.
    16. José Ángel Gimeno & Eva Llera & Sabina Scarpellini, 2018. "Investment Determinants in Self-Consumption Facilities: Characterization and Qualitative Analysis in Spain," Energies, MDPI, vol. 11(8), pages 1-24, August.
    17. Mir-Artigues, Pere & Cerdá, Emilio & del Río, Pablo, 2018. "Analysing the economic impact of the new renewable electricity support scheme on solar PV plants in Spain," Energy Policy, Elsevier, vol. 114(C), pages 323-331.
    18. Adam V. Reed & Pedro A. C. Saffi & Edward D. Van Wesep, 2021. "Short-Sales Constraints and the Diversification Puzzle," Management Science, INFORMS, vol. 67(2), pages 1159-1182, February.
    19. Panagiotis Anagnostopoulos & Niki-Artemis Spyridaki & Alexandros Flamos, 2017. "A “New-Deal” for the Development of Photovoltaic Investments in Greece? A Parametric Techno-Economic Assessment," Energies, MDPI, vol. 10(8), pages 1-25, August.
    20. Sherif El-Halaby & Hosam Abdelrasheed & Khaled Hussainey, 2021. "Corporate Cash Holdings and National Culture: Evidence from the Middle East and North Africa Region," JRFM, MDPI, vol. 14(10), pages 1-22, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:juipol:v:80:y:2023:i:c:s0957178722001400. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.sciencedirect.com/journal/utilities-policy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.