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ประกาศรับสมัครทุนสถาบันวิจัยเศรษฐกิจป๋วย อึ๊งภากรณ์ ประจำปี 2568 รอบที่ 2 (ประเภททั่วไป)
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2 November 2016
20161478044800000
No. 047

Optimal Environmental Policies and Renewable Energy Investment in Electricity Markets

Wichsinee Wibulpolprasert

Abstract

Renewable electricity subsidies have been popular policy instruments to combat climate change because of their ability to offset emissions. This paper studies the long-run welfare benefits of optimizing the design of the existing renewable energy subsidy (the status quo) in the presence of heterogeneity in the offset emissions. In particular, I measure the welfare gain from differentiating renewable subsidies across location and time to reflect the environmental benefits from offseting emissions. I find that the welfare gain from differentiation is small compared to the gain already achieved under the status quo subsidy. In contrast, the optimal emissions tax yields much larger welfare gain because it engages in other cost-effective emissions abatement channels that renewable energy subsidies do not: namely, demand conservation and cross-plant fuel substitution.

Wichsinee Wibulpolprasert
Wichsinee Wibulpolprasert
Thailand Development Research Institute
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JEL: H23L10Q5
Tags: climate changerenewable energyemissions taxrenewable subsidieselectricity marketinvestmentenvironmental benefitsmarginal emissionsheterogeneityfuel switchingdemand responsewind resource
The views expressed in this workshop do not necessarily reflect the views of the Puey Ungphakorn Institute for Economic Research or the Bank of Thailand.
Wichsinee Wibulpolprasert
Wichsinee Wibulpolprasert
Thailand Development Research Institute

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