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Sources of Finance, Investment Policies and Plant Entry in the Renewable Energy Sector

Listed author(s):
  • Margarita Kalamova


  • Christopher Kaminker


  • Nick Johnstone


This report looks specifically at the full array of public policies promoting investment in the renewable energy sector, and discusses their impact on plant entry into the market, with the support of case studies focusing on Germany, the U.S.A. and Australia. It examines differing risk/return expectations across stages of the investment continuum (from R&D through to mergers and acquisitions) and the financial structures that are employed at each stage. Although transparency, predictability and longevity of government programmes are necessary if investors are to initiate a project in clean energy, predictability should not be mistaken for permanence. In the case where policies target investment in physical capital, it is important to ‘sunset’ many of the policies discussed in this report. It is the nature of entrepreneurship that not all investments in new activities will pay off and not all promotion efforts will be successful. Against such a backdrop, public investment policy will also frequently meet with failure. Combining continuous assessment with policy predictability is a delicate balancing act. Clear criteria for policy evaluation are required, and ideally the criteria for success should depend on productivity. Ce rapport s’intéresse plus particulièrement à l’éventail complet des politiques publiques encourageant l’investissement dans le secteur des énergies renouvelables, et analyse leurs effets sur l’entrée de nouvelles entreprises sur le marché, en s’appuyant sur des études de cas réalisées en Allemagne, aux États-Unis et en Australie. Il étudie les différentes attentes en termes de risque/rendement au cours des différentes phases du processus d’investissement (de la R-D jusqu’aux fusions-acquisitions), et les structures financières correspondantes. Bien que la transparence, la prévisibilité et la longévité des programmes publics soient nécessaires pour que les investisseurs se lancent dans les énergies propres, il ne faut pas confondre prévisibilité et permanence. Quand les politiques publiques ciblent l’investissement dans le capital physique, de nombreuses mesures examinées dans ce rapport doivent être mises de côté. Les entrepreneurs savent pertinemment que la totalité des investissements consacrés à de nouvelles activités, y compris les efforts de promotion, ne sont pas toujours fructueux. Dans ce contexte, les politiques d’investissement public se soldent souvent par un échec. Concilier évaluation continue et prévisibilité des politiques est un exercice d’équilibre délicat, qui doit reposer sur des critères d’évaluation clairement définis, dont le principal devrait idéalement être celui de productivité.

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Paper provided by OECD Publishing in its series OECD Environment Working Papers with number 37.

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Date of creation: 29 Jul 2011
Handle: RePEc:oec:envaaa:37-en
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