Shortcomings of Renewable Energy Auctions Based on World-wide Empirical Observations
This report analyses policy instruments for grid-connected renewable energy deployment in the electricity sector, focusing on the shortcomings of auctions and novel ways of combining them with administratively set feed-in premiums or feed-in tariffs. It, therefore, focuses on the most widely used policy instruments for the deployment of renewable energy in the electricity sector, with both instruments being used in more than a hundred jurisdictions worldwide.
The authors make the case for a broader policy mix, including feed-in tariffs for small and medium-sized projects and auctions for large-scale installations. The question is no longer about the right choice of one policy instrument in the policy toolbox, but rather about the right combination of a variety of instruments, taking into consideration the advantages and shortcomings of both auctions and feed-in tariffs.