What drives renewable energy development?

L. Alagappan*, R. Orans, Chi-Keung WOO

*Corresponding author for this work

    Research output: Contribution to journalJournal articlepeer-review

    92 Citations (Scopus)

    Abstract

    This viewpoint reviews renewable energy development in 14 markets that differ in market structure (restructured vs. not restructured), use of feed-in-tariff (FIT) (yes vs. no), transmission planning (anticipatory vs. reactive), and transmission interconnection cost allocated to a renewable generator (high vs. low). We find that market restructuring is not a primary driver of renewable energy development. Renewable generation has the highest percent of total installed capacity in markets that use a FIT, employ anticipatory transmission planning, and have loads or end-users paying for most, if not all, of the transmission interconnection costs. In contrast, renewable developers have been less successful in markets that do not use a FIT, employ reactive transmission planning, and have generators paying for most, if not all, of the transmission interconnection costs. While these policies can lead to higher penetration of renewable energy in the short run, their high cost to ratepayers can threaten the economic sustainability of renewable energy in the long-run.

    Original languageEnglish
    Pages (from-to)5099-5104
    Number of pages6
    JournalEnergy Policy
    Volume39
    Issue number9
    DOIs
    Publication statusPublished - Sept 2011

    Scopus Subject Areas

    • Energy(all)
    • Management, Monitoring, Policy and Law

    User-Defined Keywords

    • Interconnection cost
    • Renewable energy development
    • Transmission planning

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