Assessing the Cost-Effectiveness of Renewable Energy Deployment Subsidies: Solar PV in Germany and Spain

This study reviews deployment subsidies for solar PV in two European countries, Germany and Spain.

Its primary goal is to better inform debates about cost-effectiveness by exploring the methods required to assess cost-effectiveness and by estimating the general magnitude and range of benefits in several key areas.

The study forms one of a series of three looking at the cost-effectiveness of renewable energy deployment subsidies, each one focusing on different technologies and countries. The increased deployment of low-carbon energy is one of the principal interventions required to avoid catastrophic climate change. At the same time, the success of deployment will depend upon government policy that is effective and that uses resources efficiently. This is central to maximizing the amount of renewables deployed given the resources that are available and to ensuring that subsidies for renewables remain politically viable. These studies represent a first effort to develop an appropriate multi-criteria framework for evaluating the cost-effectiveness of renewable energy subsidies, taking into account all costs and the wide range of potential benefits.