Feger, Fabian; Pavanini, Nicola; Radulescu, Doina (2022). Welfare and Redistribution in Residential Electricity Markets with Solar Power. Review of Economic Studies, 89(6), pp. 3267-3302. Oxford University Press 10.1093/restud/rdac005
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An increasing number of households installing solar panels and consuming the energy thus produced raises two challenges for regulators: network financing and vertical equity. We propose alternative tariff and subsidy designs for policymakers to incentivize solar panel adoptions and guarantee that network costs are recovered, while trading off efficiency, equity, and welfare motives. We estimate a structural model of energy demand and solar panel adoption, using a unique matched dataset on energy consumption, prices, income, wealth, solar panel installations, and building characteristics for 165,000 households in Switzerland from 2008 to 2014. Our counterfactuals recommend the optimal solar panel installation cost subsidies and two-part energy tariffs to achieve a solar energy target. We show that, relative to installation cost subsidies, relying on marginal prices to incentivize solar panel adoptions is more cost efficient and progressive across the income distribution, but generates a larger aggregate welfare loss.
Item Type: |
Journal Article (Original Article) |
|---|---|
Division/Institute: |
11 Centers of Competence > KPM Center for Public Management |
UniBE Contributor: |
Feger, Fabian Stefan, Radulescu, Doina Maria |
Subjects: |
300 Social sciences, sociology & anthropology > 350 Public administration & military science 300 Social sciences, sociology & anthropology > 330 Economics |
ISSN: |
0034-6527 |
Publisher: |
Oxford University Press |
Language: |
English |
Submitter: |
Benedikt Janzen |
Date Deposited: |
27 Mar 2023 11:18 |
Last Modified: |
27 Mar 2023 23:27 |
Publisher DOI: |
10.1093/restud/rdac005 |
BORIS DOI: |
10.48350/180505 |
URI: |
https://boris.unibe.ch/id/eprint/180505 |
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