The implicit carbon price of renewable energy incentives | Claudio Marcantonini
Channel: Florence School of Regulation
Date: 30/07/2013

Author: Claudio Marcantonini (Research Assistant, Climate Policy Research Unit at Loyola de Palacio Chair)
Category: FSR webinar recording
Level: advanced
Date of release: July 2013
 
This is a recording of webinar held on 16th July 2013, moderated by Magdalena Mos (FSR Training Coordinator)
 
The European Union has an ambitious climate and energy policy for 2020 with the target to increase renewable energy (RE) to 20% of the all energy consumption. All member states have developed policy to support renewables, most of the in the form of direct incentives for production of RE. These polices have been very effective to increase renewable energy especially in the electricity sector, but at what cost? In this webinar Claudio Marcantonini (Scientific coordinator of the Climate Policy Research Unit) analyzes the efficiency of the RE incentives as climate policy instrument, that is as a means to reduce GHG emissions. This is the first justification given by the renewable energy directive for the renewable energy target. To this propose, the implicit carbon price of the RE incentives is calculated. This is given by the ratio of the net cost over the CO2 emission reductions resulting from the use of renewable energy and can be considered as an estimation of the cost to reduce CO2 emission using the RE incentives. The net cost of RE is the sum of the costs and savings for consumers resulting from RE into the electric power system while CO2 emission reduction is the net change in CO2 emissions between the power system with and without the RE. The webinar presents case studies for wind and solar technology in Germany, Italy and Spain for the period 2006-2012. It shows that supporting solar energy through deployment incentives has proven to be a very expensive way of reducing CO2 emissions in all country analyzed, while supporting wind was much less expensive especially in Germany.
 
To read more on the topic you can look at the following CPRU working papers:
http://fsr.eui.eu/Publications/WORKINGPAPERS/Energy/2013/WP201305.aspx
http://fsr.eui.eu/Publications/WORKINGPAPERS/Energy/2012/WP201218.aspx
 
 
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