(Mis)allocation of Renewable Energy Sources

Résumé

Policies to incentivize the adoption of renewable energy sources (RES) usually offer little flexibility to adapt to heterogeneous benefits across locations. We evaluate the geographical misallocation of RES associated 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. We find that total value of solar would increase by 6.4% relative to the current allocation using conservative values for solar penetration. Reallocating all solar and taking into account transmission would yield considerably larger gains.

Mots-clés

Renewable energy sources; electricity markets; feed-in-tariffs; ancillary services; misallocation.;

Codes JEL

H23: Externalities • Redistributive Effects • Environmental Taxes and Subsidies
Q42: Alternative Energy Sources
Q48: Government Policy
Q51: Valuation of Environmental Effects

Remplacé par

Stefan Lamp et Mario Samano, « (Mis)allocation of Renewable Energy Sources », Journal of the Association of Environmental and Resource Economists, vol. 10, n° 1, janvier 2023.