Comparative Policy Frameworks
A Study of Wind Power Advance
in Brazil, China, Germany, India, Spain and the US
Kathy Araujo, PhD CandidateMIT - EWEC 2010, Warsaw, Poland
Photo: Courtesy of the Spanish Wind Energy Association
Wind Potential Worldwide
Source: NREL
Estimate: 40x the current power consumption or more than 5 times global use of all energy forms (Lu et al, 2009)
Overview
Study Phase 1: 1995-2007CountriesQuestions/Areas ConsideredResearch ApproachData and PoliciesFindings
Study Phase 2: 2008-2009 Updates (ongoing)
Questions
6 Country Study
50% Industrialized and 50% Industrializing Countries
Selected from 3 regions – Asia, Europe and the Americas
All Hold High Wind Potential with Wind Development Evident
Countries Selected
Areas considered
(1) Policy frameworks that have been more/less effective in spurring greater integration of wind power
(2) Key factors that explain differing levels of wind power development
(3) The relevance of industrialization level
(4) The role of natural resource endowments or geography
Research Approach
Hypothesis: Countries with Robust Wind Policies
(i.e. grid access guarantees, performance standards and adaptation)
+
Stable Policy Horizon of at least 10 Years = Greatest % of Wind in Power Generation
Data Analysis and Historical Document Review Field Research: Interviews
Source: BP (2009), based on gross output.
Electric Generation by Country (Twh)
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Brazil
China
Germany
India
Spain
US
Stages 1 & 2
Installed Wind Capacity (MW)
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000
Germany
Spain
US
Brazil
China
India 2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
Source: UN, 2008; GWEC 2006, 2007, 2008; Wind Power Monthly, 2010; IDAE, 2009;
Wind-Related Characteristics Non-Annex 1 Countries Annex 1 Countries
Brazil China India Germany Spain US
Total Installed Capacity 634 20,000 10,742 25,030 17,940 32,919(2009)
Factor Increase inTotal Installed Capacity 211 524 52 22 598 19 1995-2009 (growth by a factor of x)
% of Global Installed Cap <1 14 7 17 12 23(2009)
Source: Wind Power Monthly, 2010; IEA, GWEC and UN, 2009; AEE, 2009; Dutra, 2001;
Wind, % of Total <1 to <1 <1 to 1 <1 to 2 <1 to 9 <1 to 12 <1 to <2 Electricity (GWh)1995 and 2008
Wind-Related Characteristics Non-Annex 1 Countries Annex 1 Countries
Brazil China India Germany Spain US
Total Installed Capacity 634 20,000 10,742 25,030 17,940 32,919 (2009)
Factor Increase inTotal Installed Capacity 211 524 52 22 598 19 1995-2009 (growth by a factor of x)
% of Global Installed Cap <1 14 7 17 12 23 (2009)
Source: Wind Power Monthly, 2010;
Wind, % of Total <1 to <1 <1 to 1 <1 to 2** <1 to 9 <1 to<12 <1 to <1 Electricity (GWh)1995 and 2009
National Wind Policy Instruments
1995-2007
*Sub-national policy
Wind Manufacturing Sector
Spanish Companies Yes Yes
German … Yes Yes
Indian … Yes Yes
Brazil … Negligible No
China … Yes Emergent
United States … Yes Yes
Native Company Engagement
Domestic Market International
Findings
– Brazil, Germany, Spain and the US have relied upon production-based policies with FIT or PTC instruments. In contrast, India and China have been more investment-based, relying on tendering auctions or investment instruments like rapid depreciation and VAT reductions as their wind-related policy instruments.
– The US and India appear to have fewer national wind/RET policies, leaving policy space for states/regions or for market dynamics to operate. Like the US and India, Brazil’s policy path is currently less robust than in German, Spain and China. The choice of policy instruments seems to blur the distinction between industrialized and industrializing countries.
– Although considered a strong policy instrument, the presence of an FIT absent adaption to conditions or a more comprehensive policy package can result in limited scale-up.
– The need for grid investment was a common and at times a pressing theme in every country.
– Germany and Spain share not only policy frameworks and EU mechanisms, but a need to diversify.
Findings
Stage 1 Conclusions:
(1) Key factors that explain differing levels of wind power development - Interplay of generation costs, environmental stewardship, availability of rival fuels and fuel price levels/volatility factor prominently
(2) Policy frameworks that have been more/less effective in spurring greater integration of wind power - Top-down market-based and regulatory policies including advanced feed-in tariffs, targets and carbon trading
(3) The relevance of industrialization level - Levels of industrialization appear to be related to country-level installed capacities and the share of the global market that each country represents, but not the rate of wind power development
(4) The role of natural resource endowments or geography - The existence of an abundance of a rival fuel source leaves wind
power to be considered more marginally
Updates
India - currently is adopting a national FIT
China - adopted regional FITs
Brazil - shifted to wind power auctions
US - extended its FIT for 3 years
- additionally, a key governmental decision on an offshore wind project is imminent
Additional
Questions –
Thank you!
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