Global renewables development impeded by existing auction policies-- study

Dec 23, 2020 06:24 PM ET
  • Worldwide dependence on auctions is warding off the growth of renewables as well as stopping working to provide fair access to the market for small-scale industry gamers, new research study suggests.
Global renewables development impeded by existing auction policies-- study
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A bigger policy mix, as a result, is "quickly called for" to permit a development of renewables, according to the research commissioned by think tanks Energy Watch Group, World Future Council, Global Renewables Congress and Haleakala Stiftung.

The report, which is based upon an evaluation of more than 20 markets, says public auctions have a "bad performance history" in accomplishing nations' deployment targets, partially as a result of them being undersubscribed as well as project hold-ups or terminations.

On the other hand, economic situations of scale favouring huge projects, the need to bear the sunk prices of unsuccessfully bid projects and the expenses of funding are stated to create competitive advantages for bigger actors, to the detriment of brand-new players looking to get into the market.

" The findings of the report clearly reveal that auctions are a critical element hindering the rapid growth of renewables," claimed Energy Watch Group head of state Hans-Josef Fell. "This worrying fad jeopardises worldwide governments' conformity with the environment targets concurred in Paris."

Amongst the countries that have executed renewables public auctions in 2020 are Germany, France, India, Poland and also Portugal, with the latter receiving a record tariff of US$ 0.0131/ kWh. Following year will certainly see Spain, Chile, Colombia and the UK, to name a few, carry out auctions to aid drive tidy energy project growth.

The study states that enough time has passed since auctions were first introduced in a great deal of countries, implying final thoughts can currently be drawn from their results.

While recognizing that they have ended up being an "vital ingredient in the renewable resource policy toolkit", the report states public auctions typically leave out little as well as medium-sized projects, which, if built, can supply a boost for regional employment and also local growth. It adds that experience from around the globe reveals that public auctions "have actually been broadly not successful" at urging a series of project sizes concurrently.

Anna Leidreiter, project lead worldwide renewables congress at World Future Council, stated a political structure that opens up the energy market for brand-new gamers is required. "This study reveals that auctions alone can not offer this function."

Depending upon the market sector, the report authors call for feed-in tariffs or feed-in costs for little and medium-sized projects, making use of self-consumption policies for really small-scale projects and for the proceeded use of auctions for large-scale projects.

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