Renewable Technologies and Risk Mitigation in Small Island Developing States (SIDS): Fiji's Electricity Sector
In recent years, renewable energy technologies have been advocated in Small Island Developing States (SIDS) in the Pacific as a risk-mitigation measure against oil price volatility. Despite this, there have been no attempts to measure the impact of renewable technologies on financial risk in these countries. This paper develops and applies a stochastic simulation model in order to assess the effect of renewable technologies on the financial risk and cost of electricity supply in Fiji. The modelling results support investments in some, although not all, renewable technologies. Investments in low-cost, low-risk technologies such as energy efficiency, geothermal, biomass and bagasse technologies are found to lower both portfolio generation costs and financial risk. This suggests the Government of Fiji should be encouraging further investment in these technologies, commensurate with increases in total electricity supply. It also suggests that the FEA should prioritize such investments over its planned expansion of hydro-power generation. Renewable technology investments in other SIDS in the Pacific are likely to involve similar risk mitigation benefits.
|Date of creation:||Feb 2012|
|Contact details of provider:|| Postal: Crawford Building, Lennox Crossing, Building #132, Canberra ACT 2601|
Phone: +61 2 6125 4705
Fax: +61 2 6125 5448
Web page: https://crawford.anu.edu.au/research/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gotham, Douglas & Muthuraman, Kumar & Preckel, Paul & Rardin, Ronald & Ruangpattana, Suriya, 2009. "A load factor based mean-variance analysis for fuel diversification," Energy Economics, Elsevier, vol. 31(2), pages 249-256, March.
- Awerbuch, Shimon & Sauter, Raphael, 2006.
"Exploiting the oil-GDP effect to support renewables deployment,"
Elsevier, vol. 34(17), pages 2805-2819, November.
- Shimon Awerbuch & Raphael Sauter, 2005. "Exploiting the Oil-GDP Effect to Support Renewables Deployment," SPRU Working Paper Series 129, SPRU - Science and Technology Policy Research, University of Sussex.
- Allan, Grant & Eromenko, Igor & McGregor, Peter & Swales, Kim, 2011. "The regional electricity generation mix in Scotland: A portfolio selection approach incorporating marine technologies," Energy Policy, Elsevier, vol. 39(1), pages 6-22, January.
- Mayer, Peter C., 2000. "Reliability economies of scale for tropical island electric power," Energy Economics, Elsevier, vol. 22(3), pages 319-330, June.
- Weisser, Daniel, 2004. "On the economics of electricity consumption in small island developing states: a role for renewable energy technologies?," Energy Policy, Elsevier, vol. 32(1), pages 127-140, January.
- Craig Sugden, 2009. "Responding to High Commodity Prices," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 23(1), pages 79-105, 05.
- Shimon Awerbuch, 2006. "Portfolio-Based Electricity Generation Planning: Policy Implications For Renewables And Energy Security," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 11(3), pages 693-710, May.
- Awerbuch, Shimon, 2000. "Investing in photovoltaics: risk, accounting and the value of new technology," Energy Policy, Elsevier, vol. 28(14), pages 1023-1035, November.
- Harry Markowitz, 1952. "Portfolio Selection," Journal of Finance, American Finance Association, vol. 7(1), pages 77-91, 03.
When requesting a correction, please mention this item's handle: RePEc:een:crwfrp:1201. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Stern)
If references are entirely missing, you can add them using this form.