An Empirical Study On The Effectiveness Of Renewable Energy Policy Instruments

Prompted by the scarce energy resources and the severe environment problems,More and more countries worldwide have shown increased interest in promoting the use of renewable energy sources for electricity generation, and taken it as the strategy of economy development, which cannot realize without the support of renewable policy tools. So far, governments of China has adopted an array of policies to promote all types of renewable energy technologies. The comprehensive evaluation of renewable energy policy will provide evidence for the policy making in future.The connotation and application of the mail renewable energy policy tools is analyzed. The global trend analysis of the tools in recent 10 years is used to find most popular renewable energy tools which are used by most countries in the world. We find that Feed-In Tariff and public investment loans are most popular policy tools, which are used by most countries. Renewable portfolio standards, Tradable green certificates,Tender and Net-metering has got the rapidest growth since 2005. Using a panel data over40 countries and years 1996-2013, this paper uses a state fixed effects model to estimate the effects of renewable energy policy tools on the penetration of various emerging renewable electricity sources and carbon emissions. The renewable energy resources include biomass, solar photovoltaic, geothermal and wind. We find that FIT and RPS have significant impacts on biomass and carbon emissions. Tradable green certificates and public investment loans are positive for the penetration of wind and decreasing carbon emissions, and negative for biomass and solar. Tender is also found to be negative for biomass, geothermal and solar, while net-metering result in increasing the penetration of wind and reduction of carbon emissions.Through the reorganization of Chinese related renewable energy policies, we get the policy tools and targets with highest frequency in policies which is Feed-In Tariff and power grid Corporations and generation enterprises. Using the hierarchical analysis method, we build an index system to evaluate the effectiveness of China's renewable energy policy tools and get the score of all types of tools from stakeholders. Based on the empirical results, this article aims to give some policy recommendations to the current renewable energy policy tool combinations in China.