Since RECs vary in price and do not usually cover the costs of building generation (over and above wholesale or retail power prices in the US) plus a reasonable profit, doesn’t that makes them a little dicey to use as a means for project developers and home or business owners to install renewable energy generation?
Feed-in Tariffs: The Economic Case
Conversations about building new renewable energy almost always come back to the electricity from these projects being more expensive than fossil fuel energy. This may be the case (although it’s almost certainly overstated), but this shouldn’t lead to the conclusion that the way to minimize rate impacts is simply to use less renewable energy. In fact, there are policy tools that can help lower the cost of renewable energy, letting us meet renewables goals at a lower price. . .
The 135-page report by the Intergovernmental Panel on Climate Change , especially Chapter 11 on Policy, Financing and Implementation, makes it clear that the overwhelming weight of academic studies conclude that feed-in tariffs–or fixed-price mechanisms–perform better at delivering renewable energy quickly and equitably than quota systems, such as Renewable Portfolio Standards in the US or the Renewable Obligation in Britain. This is not the unsurprising conclusion from a surprising source: the IPCC’s Working Group III on Renewables.
Many renewable energy advocates argue that the market for solar renewable energy credits (SRECs) is a more cost-effective tool for incentivizing solar power than a feed-in tariff (or CLEAN contract) set in a regulatory proceeding. . . Really?
Feed-in Tariffs Saved French Ratepayers Money They Would Have Otherwise Spent
by Cécile Bordier, Caisse des Dépôts, December 2008 This was a report in English by the French Bank, Caisse des … Read more
Germany in particular stands out and is able to demonstrate many benefits that come with a strong volume response while being responsive to significant market developments. In a North American context, the province of Ontario has many features of a strong policy design. . .
The movement for feed-in tariffs in North America has finally chalked up a few victories, and, as a result, … Read more
An excellent primer on why wind energy (and solar PV) needs feed-in tariffs. . .
