The impact of policy attributes and developer background on renewable energy technology investment. A case study of the Stimulering Duurzame Energieproductie+ subsidy.
Oort, T.N.M. van
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In order to improve the amount of private investment in renewable energy projects, numerous government support schemes have been established. These support schemes are often aimed at reducing the risks associated with renewable energy technologies and improving their return. However, many of these support schemes proof to be ineffective or fail to fully meet their goals. Scholars have noted that in order to explain the effectiveness of government support schemes a techno-economic analysis falls short of explaining why some subsidies are more effective than others. This study moves beyond the pure techno-economic analysis by also including the background of renewable energy project developers into the equation. This study uses a mixed method approach. First interviews were conducted among developers and experts, followed by a discrete choice experiment. The interviews were used to gain a deeper understanding of the workings of the studied case, and to make the discrete choice experiment more aligned with real life situations. The results show that the developers background can in some cases influence the investment decisions. Furthermore, the results also confirm that for the largest part investment decisions are influenced by return on investment and the risk associated with the investment. However, the degree with which these factors influence developers investment decisions may vary with the developers background. The theoretical and practical implications are, future studies and policies should beyond a pure risk and return assessment when analyzing renewable energy subsidies and include the effects of the renewable energy developers’ backgrounds in their assessment.