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Bridging the Gap: Do Fast Reacting Fossil Technologies Facilitate Renewable Energy Diffusion?

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  • Elena Verdolini

    ()

  • Francesco Vona

    ()

  • David Popp

    ()

Abstract

This paper discusses the role of fossil-based power generation technologies in supporting renewable energy investments. It studies the deployment of technologies conditional on all other drivers in 26 OECD countries between 1990 and 2013. It shows that a 1% percent increase in the share of fast-reacting fossil generation capacity is associated with a 0.88% percent increase in renewable in the long run. These results are robust to various modifications in the empirical strategy, and most notably to the use of system-GMM techniques to account for the interdependence of renewable and fast-reacting fossil investment decisions. [Working Paper 22454]

Suggested Citation

  • Elena Verdolini & Francesco Vona & David Popp, 2016. "Bridging the Gap: Do Fast Reacting Fossil Technologies Facilitate Renewable Energy Diffusion?," Working Papers id:11125, eSocialSciences.
  • Handle: RePEc:ess:wpaper:id:11125
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    References listed on IDEAS

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    Cited by:

    1. Mare Sarr & Joëlle Noailly, 2017. "Innovation, Diffusion, Growth and the Environment: Taking Stock and Charting New Directions," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 393-407, March.
    2. Lionel Nesta & Elena Verdolini & Francesco Vona, 2018. "Threshold Policy Effects and Directed Technical Change in Energy Innovation," Documents de Travail de l'OFCE 2018-05, Observatoire Francais des Conjonctures Economiques (OFCE).
    3. Conti, Chiara & Mancusi, Maria Luisa & Francesca, Sanna-Randaccio & Roberta, Sestini & Elena, Verdolini, 2016. "Transition Towards a Green Economy in Europe: Innovation and Knowledge Integration in the Renewable Energy Sector," MITP: Mitigation, Innovation,and Transformation Pathways 250256, Fondazione Eni Enrico Mattei (FEEM).
    4. Elena Verdolini & Valentina Bosetti, 2017. "Environmental Policy and the International Diffusion of Cleaner Energy Technologies," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 66(3), pages 497-536, March.

    More about this item

    Keywords

    renewable energy; power system; fossil-based technologies; OECD countries; decarbonization process;

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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