Energy prices are rising fast. The costs of renewables like wind and solar are falling. So you would think that would be a good thing- helping out. And the more the better. However, there can be problems when financial support systems use fossil fuel prices as the base for subsidies for renewables. They were assumed to cost more, but that’s no longer true, and so, although it’s not the cause of consumer price rises, there have been some perverse out-comes, with, for example, renewables getting more support than they need and enjoying so-called windfall profits. That has happened in parts of Europe where, under the marginal cost ‘premium price’ subsidy systems, the cost of the most expensive generator defines the price for all generators. Originally the high costs options were wind and solar, but now it is gas. So some consumers are being overcharged. A critique carried by Euractiv claimed that ‘in Germany (and proportionally in other countries) citizens are funding renewabl...
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