A reexamination of renewable electricity policy in Sweden

Sven-Olof Fridolfsson and Thomas Tangerås ()

Energy Policy, 2013, vol. 58, issue C, 57-63

Abstract: Green certificates are the main instrument for promoting renewable electricity (RES-E) in Sweden. But certificates cover only a limited share of total RES-E production. Under partial coverage, crowding out may arise whereby costly new RES-E replaces inexpensive old RES-E. Granting certificates to all of RES-E production improves efficiency, but leaves windfall rent to otherwise profitable facilities. We also analyze transaction costs in the permit process for new RES-E in Sweden. Municipalities veto socially desirable projects because of asymmetrically distributed investment costs and benefits. We propose market-based permit fees rather than limited veto rights as a solution to this NIMBY problem.

Keywords: Crowding out; Green certificates; NIMBY (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (8)

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Working Paper: A Reexamination of Renewable Electricity Policy in Sweden (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:58:y:2013:i:c:p:57-63

DOI: 10.1016/j.enpol.2013.02.032

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