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How do solar photovoltaic feed-in tariffs interact with solar panel and silicon prices? An empirical study

Author

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  • Arnaud De La Tour

    (CERNA i3 - Centre d'économie industrielle i3 - MINES ParisTech - École nationale supérieure des mines de Paris - PSL - PSL Research University - CNRS - Centre National de la Recherche Scientifique)

  • Matthieu Glachant

    () (CERNA i3 - Centre d'économie industrielle i3 - MINES ParisTech - École nationale supérieure des mines de Paris - PSL - PSL Research University - CNRS - Centre National de la Recherche Scientifique)

Abstract

Preferential feed-in tariffs (FITs) for solar generated electricity increases the demand for solar photovoltaic systems. They can thus induce price to increase, creating the potential for PV systems producers to collect rents. This paper analyses the interactions between feed-in tariffs, silicon prices and module prices, using weekly price data and FIT values in Germany, Italy, Spain, and France from January 2005 to May 2012. Relying methodologically on the Granger causality tests applied to vector autoregressive models, we show that since the end of the period of silicon shortage in 2009, module price variations cause changes in FITs, and not the reverse. This is good news as it suggests that the regulators have been able to prevent FITs to inflate module prices.

Suggested Citation

  • Arnaud De La Tour & Matthieu Glachant, 2013. "How do solar photovoltaic feed-in tariffs interact with solar panel and silicon prices? An empirical study," Working Papers hal-00809449, HAL.
  • Handle: RePEc:hal:wpaper:hal-00809449
    Note: View the original document on HAL open archive server: https://hal-mines-paristech.archives-ouvertes.fr/hal-00809449v2
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    References listed on IDEAS

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    1. Bosetti, Valentina & Catenacci, Michela & Fiorese, Giulia & Verdolini, Elena, 2012. "The future prospect of PV and CSP solar technologies: An expert elicitation survey," Energy Policy, Elsevier, vol. 49(C), pages 308-317.
    2. de la Tour, Arnaud & Glachant, Matthieu & Ménière, Yann, 2011. "Innovation and international technology transfer: The case of the Chinese photovoltaic industry," Energy Policy, Elsevier, vol. 39(2), pages 761-770, February.
    3. Nemet, Gregory F., 2009. "Interim monitoring of cost dynamics for publicly supported energy technologies," Energy Policy, Elsevier, vol. 37(3), pages 825-835, March.
    4. Branker, K. & Pathak, M.J.M. & Pearce, J.M., 2011. "A review of solar photovoltaic levelized cost of electricity," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(9), pages 4470-4482.
    5. Yu, C.F. & van Sark, W.G.J.H.M. & Alsema, E.A., 2011. "Unraveling the photovoltaic technology learning curve by incorporation of input price changes and scale effects," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(1), pages 324-337, January.
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    Cited by:

    1. Hallegatte, Stephane & Fay, Marianne & Vogt-Schilb, Adrien, 2013. "Green industrial policies : when and how," Policy Research Working Paper Series 6677, The World Bank.

    More about this item

    Keywords

    solar photovoltaic energy; feed-in tariffs; photovoltaic panel price;

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