Cost-free feed-in tariffs for renewable energy deployment in Spain

Cristobal Gallego-Castillo and Marta Victoria

Renewable Energy, 2015, vol. 81, issue C, 411-420

Abstract: Feed-in-tariff (FIT) schemes have been widely employed to promote renewable energy deployment. While FITs may be perceived by consumers as an extra cost, renewable energies cause a noticeable price reduction in wholesale electricity markets. We analyse both effects for the case of the Spanish electricity market during 2010. In particular, we examine the level of FITs that makes savings and extra costs to be similar on an hourly basis. Results are obtained for a wide range of renewable generation scenarios. It is found that FITs with null extra costs for consumers are in the range of 50–80 €/MWh. Some of the side-effects of a high penetration of renewable energy in the market are analysed in detail and discussed.

Keywords: Merit-order effect; Feed-in-tariff; Renewable energy (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:81:y:2015:i:c:p:411-420

DOI: 10.1016/j.renene.2015.03.052

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