The different instruments of renewable energy policy
can be combined in various ways to form a comprehensive renewable energy policy.
Different renewable energy concepts can be distinguished according to the
scope and the degree of intervention.
- There is hardly any country that has no policy at all in favour of renewables. Although many developing countries do not have a significant national
programme destined specifically for promotion of renewable energies
(RE), they generally do incorporate renewables in programmes for rural energy, electricity sector
expansion, etc. Scattered non-aligned and non-coherent renewable
energy projects, however, have not proven successful, even when carried
out with support from international cooperation.
- A number of countries have started limited
renewable energy programmes, combining, in a targeted
way and for a specific market or technology, measures in awareness
raising, capacity building, and R&D with the deployment of renewable
energy technologies (RET) through
individual projects on the ground. The deployment may be partially or
totally financed through public sources. However, partnerships with the
private sector are becoming increasingly commonplace applying first concession and market access schemes.
The International Action
Programme of the Bonn renewables 2004 Conference and its
follow-up by the REN21 Secretariat showcase such programmes from
Egypt, Pakistan, Uganda and other countries. Such programmes may
constitute an
important first step and become the basis of a larger effort. Support from multilateral and bilateral international cooperation,
the Global Environment Fund (GEF), and carbon markets is available and used in the areas of
R&D, economic development and trade, financing, and policy formulation.
- In the past, many industrialised countries have
approached renewable energy policies from the technology
development side, restrained to research
and development (R&D), awareness building, information and capacity building.
However, the expectation that energy suppliers would take these
technologies up and introduce them into their appropriate markets have
mostly not materialised.
Realising that important barriers existed for the commercialisation
of RETs, the focus of policies shifted towards markets. There are
basically two approaches which are applied in addition to the
elements of R&D, capacity building etc:
- One approach concentrates on improving the relative competitive situation of
RET in given markets. There is a wide array of financial incentives
suitable to lower the cost or provide a premium to renewables.
Indirectly, also a policy to internalise external cost of competing
fossil energy supply has this function. Such policies which aim at levelling the
playing field are effective in countries where the market entry barriers for
renewable energies have already been reduced significantly (e.g. federal US policies)
- Another, more forceful approach is geared
towards market transformation.
With such policies the rules within relevant markets are adjusted
in order to assure not only access for RET, but actually support RET to achieve a
significant market share. Important components of such
transformation efforts are mandated market policies such as price
guaranties in
feed in laws, quotas in renewable portfolio standards and, to a lesser extent, public bidding and
green certificates.
In general, experience has shown that the most effective lever is the
demand-pull. This not only makes the renewable energy share grow, but
triggers dynamic effects which sustain
the competitiveness of RET: As markets expand and industries grow, more
private initiative and money is drawn into private research and
development, and economies of scale are achieved.
The International Energy Agency (IEA) has
pointed out serious deficiencies in public R&D for RET in its 2006
report
Renewable Energy – RD&D Priorities.
In order to accelerate the deployment of RET through focussed
international cooperation, the IEA has established a new implementing
agreement on
Renewable
Energy Technology Deployment following the Bonn renewables 2004
Conference.
Recommended Reading:
Renewable Energy - Market and Policy Trends in IEA Countries, International Energy
Agency 2004
Renewable Energy Policies and Barriers, Fred Beck and Eric
Martinot, in: Encyclopedia of Energy, C:J: Cleveland (ed.) 2004
