Excess demand or excess supply? A comparison of renewable energy certificate markets in the United Kingdom and Australia

Yunfei Wang, Jinke Li, Nigel O'Leary and Jing Shao

Utilities Policy, 2024, vol. 86, issue C

Abstract: Comparing the United Kingdom's Renewables Obligation and Australia's Renewable Energy Target, this paper reconstructs the market for green certificates in which penalties are imposed on missed certificates. Our analysis shows that excess demand in the Renewables Obligation makes the penalty the minimum certificate price, but excess supply in the Renewable Energy Target makes the penalty the maximum certificate price. Further, excess supply also implies that the sales of certificates are not guaranteed in the Renewable Energy Target. Therefore, compared to the Renewables Obligation, generators face greater risk under the Renewable Energy Target as there is more uncertainty about the price of certificates and the possibility of sales.

Keywords: Tradable green certificates; Renewables obligation; Renewable energy target (search for similar items in EconPapers)
JEL-codes: H32 L94 Q21 Q28 Q48 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0957178723002175
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:86:y:2024:i:c:s0957178723002175

DOI: 10.1016/j.jup.2023.101705

Access Statistics for this article

Utilities Policy is currently edited by Beecher, Janice

More articles in Utilities Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().