Renewable Energy Support Through Feed-in Tariffs: A Retrospective Stakeholder Analysis

Majid Hashemi (), Glenn Jenkins () and Frank Milne

No 1514, Working Paper from Economics Department, Queen's University

Abstract: This study develops a generalized evaluation framework that can be used to quantify the financial, economic, stakeholder, and environmental impacts of renewable energy support programs. The application of this framework is demonstrated by evaluating the Feed-In Tariff (FIT) program for solar distributed energy resources (DER) in Ontario, Canada. Our analysis reveals that Ontario’s FIT program has successfully promoted the adoption of solar DER across communities. However, the program has caused inequitable societal outcomes through a crosssubsidization with a present value of 9 CAD billion, paid for by the electricity consumer base for the benefit of only the 0.06 percent of electricity consumers who could install solar systems. The cost imposed on the Canadian economy ranges from 2.86 to 5.37 CAD billion, depending on the discount rate applied. The sensitivity analysis results indicate that the burden of this program on the Canadian economy would have been reduced by 50 percent if the program had been delayed and implemented in 2016 instead of 2010 due to the declining trend in solar system investment costs. The lessons from this analysis provide insights for designing future environmental and emission reduction policies.

Keywords: Renewable Energy Subsidy; Distributed Energy Resources; Feed-in Tariff; Stakeholder Analysis; Benefit-cost Analysis; Ontario; Canada (search for similar items in EconPapers)
JEL-codes: H23 O13 Q42 Q48 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2023-08
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
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https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1514.pdf First version 2023 (application/pdf)

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Working Paper: Renewable Energy Support Through Feed-in Tariffs: A Retrospective Stakeholder Analysis (2023)
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