IDEAS home Printed from https://ideas.repec.org/p/rza/ersawp/797.html

The relationship between renewable energy and retail electricity prices: Panel evidence from OECD countries

Author

Listed:
  • Anneri M. Oosthuizen
  • George A. Thopil
  • Roula Inglesi-Lotz

Abstract

The centrality of electricity to everyday life is indisputable, and the price thereof can have significant implications. Literature is inconclusive over the effect of the renewable energy share in the energy mix on retail electricity prices as a country-specific regulatory policy has a significant impact on retail electricity prices. The purpose of this paper is to determine the effect of the increasing renewable electricity share on retail electricity prices for 34-OECD countries, considering the change in market structure for 23 EU countries. The results show that the influence of the renewable energy share in the energy mix on retail electricity prices is positive and statistically significant. Increasing renewable sources is inescapable in reaching SDG7, while increased awareness of true price signals should prompt private investment while phasing out support schemes in the long run. A sound regulatory framework is required to account for renewable intermittency as well as effective supply and demand matching. The positive impact on electricity prices should not deter policymakers from promoting renewable energy as the effect is marginal and is expected to decline in forthcoming years, improving energy security. The benefits of employing renewables far outweigh the environmental cost.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Anneri M. Oosthuizen & George A. Thopil & Roula Inglesi-Lotz, 2019. "The relationship between renewable energy and retail electricity prices: Panel evidence from OECD countries," ERSA Working Paper Series 797, Economic Research Southern Africa.
    • Handle: RePEc:rza:ersawp:797
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a
    for a similarly titled item that would be available.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. is not listed on IDEAS
    2. Gbeminiyi John Oyewole & George Alex Thopil, 2025. "Industrial Electricity Pricing and Renewable Energy: A Temporal Analysis of the Effect of Taxes," Energies, MDPI, vol. 18(8), pages 1-25, April.
    3. Meng, Anbo & Wang, Peng & Zhai, Guangsong & Zeng, Cong & Chen, Shun & Yang, Xiaoyi & Yin, Hao, 2022. "Electricity price forecasting with high penetration of renewable energy using attention-based LSTM network trained by crisscross optimization," Energy, Elsevier, vol. 254(PA).
    4. Xiong, Xiaoping & Qing, Guohua, 2023. "A hybrid day-ahead electricity price forecasting framework based on time series," Energy, Elsevier, vol. 264(C).
    5. Nhoyidi Nsan & Chinemerem Obi & Emmanuel Etuk, 2025. "Bridging Policy, Infrastructure, and Innovation: A Causal and Predictive Analysis of Electric Vehicle Integration Across Africa, China, and the EU," Sustainability, MDPI, vol. 17(12), pages 1-34, June.
    6. Wang, Liuhong & Ba, Zhichao & Wang, Yuefen, 2025. "How does adoption behavior towards ICT policies affect digital divides? Evidence from Chinese prefecture-level cities," Technology in Society, Elsevier, vol. 81(C).
    7. Muhammad, Sulaman & Hoffmann, Christin & Müsgens, Felix, 2025. "Assessing energy security risks: Implications for household electricity prices in the EU," Energy, Elsevier, vol. 327(C).
    8. Shilpa Sambhi & Himanshu Sharma & Vikas Bhadoria & Pankaj Kumar & Ravi Chaurasia & Georgios Fotis & Vasiliki Vita, 2023. "Technical and Economic Analysis of Solar PV/Diesel Generator Smart Hybrid Power Plant Using Different Battery Storage Technologies for SRM IST, Delhi-NCR Campus," Sustainability, MDPI, vol. 15(4), pages 1-23, February.
    9. Muhammad, Sulaman & Pan, Yanchun & Ke, Xiao & Agha, Mujtaba Hassan & Borah, Prasad Siba & Akhtar, Muhammad, 2023. "European transition toward climate neutrality: Is renewable energy fueling energy poverty across Europe?," Renewable Energy, Elsevier, vol. 208(C), pages 181-190.
    10. Hu, Likun & Cao, Yi & Yin, Linfei, 2024. "Fractional-order long-term price guidance mechanism based on bidirectional prediction with attention mechanism for electric vehicle charging," Energy, Elsevier, vol. 293(C).
    11. Ana Rita Silva & Ana Estanqueiro, 2022. "From Wind to Hybrid: A Contribution to the Optimal Design of Utility-Scale Hybrid Power Plants," Energies, MDPI, vol. 15(7), pages 1-19, April.
    12. Li, Yi & Liu, Tianya & Xu, Jinpeng, 2023. "Analyzing the economic, social, and technological determinants of renewable and nonrenewable electricity production in China: Findings from time series models," Energy, Elsevier, vol. 282(C).
    13. Qu, Chunzi & Bang, Rasmus Noss, 2024. "European Grid Development Modeling and Analysis: Established Frameworks, Research Trends, and Future Opportunities," Discussion Papers 2024/11, Norwegian School of Economics, Department of Business and Management Science.
    14. Liliana Del Carmen Suárez Santa Cruz & Victor Hugo Puican Rodriguez & Diego Isidro Ferré López & Juan José Inoñan Olivera, 2024. "Electricity Industry Strategies in Ecuador and Peru: Their Impacts on Energy Efficiency and Prices," International Journal of Energy Economics and Policy, Econjournals, vol. 14(5), pages 464-478, September.
    15. Zahari, Teuku Naraski & McLellan, Benjamin Craig, 2024. "Sustainability of Indonesia's transportation sector energy and resources demand under the low carbon transition strategies," Energy, Elsevier, vol. 311(C).
    16. Cheng, Hua & Taghizadeh-Hesary, Farhad, 2023. "How green finance can bridge the energy poverty gap: Policies to mitigate socioeconomic and environmental consequences," Energy Policy, Elsevier, vol. 182(C).
    17. Szabolcs Nagy & Laszlo Molnar & Noemi Hajdu, 2023. "Understanding the Human Dimensions of the Intention to Use Renewable Energy in Hungary Applying an Extended Model of Theory of Planned Behaviour," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 25(64), pages 830-830, August.
    18. Zhang, Tuo & Tang, Maogang, 2024. "Solar surge and cost shifts: Heterogenous effects of redistribution in the electricity bills in Japan," Energy Economics, Elsevier, vol. 137(C).
    19. Chen, Huanhuan & Li, Jinke & O'Leary, Nigel & Shao, Jing, 2025. "Higher prices in a more competitive market: The paradox in the retail electricity market in the United Kingdom," Structural Change and Economic Dynamics, Elsevier, vol. 72(C), pages 374-390.
    20. Syed Abdul Rehman Khan & Ridwan Lanre Ibrahim & Abul Quasem Al-Amin & Zhang Yu, 2022. "An Ideology of Sustainability under Technological Revolution: Striving towards Sustainable Development," Sustainability, MDPI, vol. 14(8), pages 1-21, April.
    21. Adebayo, Tomiwa Sunday & Alola, Andrew Adewale, 2023. "Drivers of natural gas and renewable energy utilization in the USA: How about household energy efficiency-energy expenditure and retail electricity prices?," Energy, Elsevier, vol. 283(C).
    22. Abban, Olivier Joseph & Xing, Yao Hong & Nuţă, Alina Cristina & Nuţă, Florian Marcel & Borah, Prasad Siba & Ofori, Charles & Jing, Yao Jing, 2023. "Policies for carbon-zero targets: Examining the spillover effects of renewable energy and patent applications on environmental quality in Europe," Energy Economics, Elsevier, vol. 126(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rza:ersawp:797. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Maggi Sigg (email available below). General contact details of provider: https://ersawps.org/index.php/working-paper-series/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.