Lamp, Stefan and Samano, Mario (2023) (Mis)allocation of renewable energy sources. Journal of the Association of Environmental and Resource Economists, vol. 10 (n° 1). pp. 195-229.

This is the latest version of this item.

Full text not available from this repository.
Identification Number : 10.1086/720722


Policies to incentivize the adoption of renewable energy sources usually offer little flexibility to adapt to heterogeneous benefits across locations. We evaluate the geographical misallocation of solar photovoltaic installations and their relation with the uniform nature of subsidies. We estimate the dispersion of marginal benefits from solar production in Germany and compute the social and private benefits from optimal reallocations of residential solar installations keeping total capacity fixed. Our findings suggest that the value of solar would increase by 5.2% relative to the current allocation using conservative values for the rates of solar installations. Reallocating all solar capacity and taking into account transmission would yield gains that range from about 16% to 30%. A benefit-cost analysis shows that additional transmission can be beneficial if there is sufficient solar capacity reallocated across regions. This puts in perspective the social costs of nationwide policies that do not offer heterogeneous incentives.

Item Type: Article
Language: English
Date: January 2023
Refereed: Yes
Place of Publication: Chicago, IL
Uncontrolled Keywords: solar energy, electricity markets, feed-in tariffs, ancillary services, misallocation
JEL Classification: H23 - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Q42 - Alternative Energy Sources
Q48 - Government Policy
Q51 - Valuation of Environmental Effects
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 22 Jan 2024 10:24
Last Modified: 15 Mar 2024 13:15
OAI Identifier:

Available Versions of this Item

View Item