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The development of renewable energy power in India: which policies have been effective?

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  • Gisèle Schmid

Abstract

The International Energy Agency has identified the development of renewable energy sources as a key element to mitigate climate change. At the same time it has projected India to be the second-largest contributor to the increase in global energy demand to 2035. India hence faces a significant challenge to ensure its energy security by diversifying its power generation mix. In the wake of the creation of a Green Climate Fund in Cancun, this paper studies empirically the effect of the introduction of the Electricity Act 2003 and the Tariff Policy 2006, as well as the implementation of feed-in tariffs and minimum quotas on clean electricity sourcing, on the development of grid-connected renewable energy power in nine Indian States over the period 2001-2009. Results suggest that the passing of the Tariff Policy 2006, state-level policies, quantity-based instruments and a greater participation of the private sector have played a key role in promoting the development of installed capacity from renewable energy power in the nine States of the sample.

Suggested Citation

  • Gisèle Schmid, 2011. "The development of renewable energy power in India: which policies have been effective?," Research Papers by the Institute of Economics and Econometrics, Geneva School of Economics and Management, University of Geneva 11103, Institut d'Economie et Econométrie, Université de Genève.
  • Handle: RePEc:gen:geneem:11103
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    1. Nick Johnstone & Ivan Haščič & David Popp, 2010. "Renewable Energy Policies and Technological Innovation: Evidence Based on Patent Counts," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 45(1), pages 133-155, January.
    2. Sen, A. & Jamasb, T., 2010. "The Economic Effects of Electricity Deregulation: An Empricial Analysis of Indian States," Cambridge Working Papers in Economics 1005, Faculty of Economics, University of Cambridge.
    3. Newell, Richard G. & Pizer, William A., 2003. "Regulating stock externalities under uncertainty," Journal of Environmental Economics and Management, Elsevier, vol. 45(2, Supple), pages 416-432, March.
    4. Pizer, William A., 2002. "Combining price and quantity controls to mitigate global climate change," Journal of Public Economics, Elsevier, vol. 85(3), pages 409-434, September.
    5. Singh, Anoop, 2006. "Power sector reform in India: current issues and prospects," Energy Policy, Elsevier, vol. 34(16), pages 2480-2490, November.
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    1. Pandey, Shreemat & Singh, Vijai Shanker & Gangwar, Naresh Pal & Vijayvergia, M.M. & Prakash, Chandra & Pandey, Deep Narayan, 2012. "Determinants of success for promoting solar energy in Rajasthan, India," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(6), pages 3593-3598.

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