Equilibrium Analysis Of Renewable Energy Development Policies Based On Market Mechanisms

With the rapid development of the global economy and the massive consumption of traditional energy, the contradiction between energy supply and demand has become more and more acute.Under this situation, many countries have set their sights on the field of renewable energy and formulated many policies on their development of renewable energy.During the last 20 years, Germany and the UK have taken different policy directions in promoting their renewable energy developments. Germany developed a feed-in tariff scheme(FIT) and the UK initially tendered for projects. And then, the UK moved to a Tradable Green Certificate scheme(RO). This policy came into force in April 2002 when the development of renewable energy in the UK confronted a lot setbacks. These different policies have different outcomes.In this paper, we aims to assess the outcomes of these different support schemes for market-based deployment of renewable energy in the UK and Germany with a colse attention to onshore wind.Through a complex assessments of these different policies in a model, we argued that the feed-in tariff adopted in Germany can protect project developers from market price competition, and although capacity and generation of renewable energy have largely increased. during that time Germany government pays a great deal of subsidy,this has not been achieved at the lowest cost. The conclusions of the UK's renewable energy market are more complex. Because competitive policies are assumed to have driven down the price of wind energy, but its policy environment exposes project developers to price competition, which has increased capital cost and inhibited the investment in the field of renewable energy. Tradable Green Certificate scheme can complete capacity target theoretically, but the effective implementation of this policy requires a rigorous market environment.In addition, this paper also analyzes a number of indirect subsidy policies for renewable energy development.China should study these experiences to resolve our country's problems.