Renewable Electricity Subsidies

Renewable electricity generation is an essential part of a sustainable energy future. An increasing number of governments are subsidizing the deployment of renewable energy technologies for electricity generation and the growth of domestic industries. What can be learned from their experiences?


Green Industrial Policy

Green industrial policy is a deliberate policy-driven effort to steer the sectoral composition of a country’s economic output and growth in a direction aligned with the objectives of sustainable development. It can rely on a variety of different policy measures, many of which constitute direct or indirect subsidies. This series of studies looks at green industrial policy in the context of renewable energy sectors. Have green industrial policies met their objectives? How efficiently? What lessons have been learned?

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Impact of Fossil Fuel Subsidies on Renewable Energy

In 2013, the International Energy Agency (IEA) estimates that consumer subsidies for fossil fuels amounted to US$548 billion, while subsidies for renewable energy amounted to US$121 billion. However, a simple comparison of subsidy expenditure does not reveal the extent to which renewable energy is disadvantaged. To understand the exact impact of this distorted playing field, it is necessary to explore how different kinds of subsidy can affect investment decisions in different ways in specific energy sectors.

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Case Studies

Subsidy policies—no matter how well intentioned—are often difficult to effectively design and implement. Understanding exactly how and why subsidy policies have caused problems in one context, while succeeding in another, can be instrumental in designing effective support schemes. This series of case studies aims to provide an authoritative account of some of the highest profile "cautionary tales" in the world of renewable electricity subsidies, asking: What exactly went wrong? And how can other countries avoid the same problems?

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Subsidies to Coal and Renewable Energy in China

The cost to society of coal use includes the financial cost of providing subsidies to the coal industry in addition to the cost of externalities. This report explores the cost of coal in terms of subsidies and externalities and discusses the extent to which coal subsidies act as a barrier to the development of renewable energy.

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Subsidies to Coal and Renewable Energy in Turkey

In response to rising electricity demand, a pressure to keep prices affordable and a need to maintain energy security, the Turkish government plans to increase electricity generation from coal. This study finds that subsidies to the coal industry reached US$ 730 million in 2013. The study finds that if the external costs of health and environmental impacts are taken into account then wind and solar energy are already cheaper than coal and likely to become even more competitive over the coming decades. The report recommends that subsides to coal are phased out.

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Cost-Effectiveness of Renewable Electricity Subsidies

These studies represent a first effort to develop an appropriate multi-criteria framework for evaluating the cost-effectiveness of renewable energy subsidies for electricity generating technologies, taking into account all costs and the wide range of potential benefits.

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Subsidies to Different Energy Types: Fossil Fuels, Renewables, Nuclear and Biofuels

These studies review knowledge to date on the scale of subsidies to electric power and to transport. They summarize estimates of subsidies to fossil-fuels, renewable power, nuclear power and biofuels, and discuss how subsidies to different energy types might be compared.

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Regional Overviews

Fossil-fuel subsidies are present in many countries around the world. The comparison of country experiences at a regional level can help identify problems and solutions that may be relevant across a given region. These GSI publications examine fossil-fuel subsidies from this regional perspective.

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