Revisiting Germanyùs solar cell promotion: An unfolding disaster

Manuel Frondel, Christoph Schmidt and Colin Vance

Economic Analysis and Policy, 2014, vol. 44, issue 1, 3-13

Abstract: This article revisits an analysis by Frondel et al. (2008) on the promotion of photovoltaics (PV) in Germany, a technology that enjoys particularly high subsidies in the form of feed-in tariffs. The result is explosive costs with little to show for either environmental or employment benefits. Indeed, we document that the immense costs foreseen by Frondel and colleagues have materialized: our updated estimate of the subsidies for PV, at Ì 108 Bn, even exceeds their expectations. Moreover, with installed PV capacities growing at a rapid rate, these costs will continue to accumulate, diverting resources from more cost-effective climate protection instruments.

Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:44:y:2014:i:1:p:3-13

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