a b s t r a c tWe examined 20 renewable energy auctions in India and elsewhere to answer two questions: first, have auctions been effective; and second, how can they be designed to achieve India's renewable energy targets? The significant contributions lie in the larger sample size, use of secondary and primary research, and application of quantitative and qualitative analysis. We found that auctions are almost always cost-effective, with savings up to 58% from baseline feed-in tariffs. However, auctions may not always be deployment-effective, with only 17% of the auctions with greater than 75% deployment. We then examined how to best design auctions by assessing seven major risks, and found the following: first, for every 1% increase in total risk, deployment effectiveness decreased by 2% points; second, project specific risks have 60% greater impact than auction specific risks; and third, deployment effectiveness is most affected by auction design, completion, and financial risks. We also found that effectiveness of auctions in India can be improved by ensuring competition, improving transmission infrastructure, providing payment guarantees, using pay-as-bid auctions, including stringent penalties for delays, and introducing auctions in a controlled manner.
Amid rising concerns of fiscal deficit and defying the advocates of rural-urban migration, the Union government of India has remained committed to its flagship social program known as Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). Launched in the year 2006, it is the largest social scheme of its kind anywhere in the world. In the financial year 2012-13 alone, more than 48 million people were provided employment under the scheme. While the scheme has shown positive results in many districts of the country, it is also facing its share of challenges on economic, managerial and political fronts. Qualitative measure gives a better insight into the success of social schemes like MGNREGA. However we should also have a comprehensive quantitative measure for the same. In this paper, we develop a methodology to measure the success of implementation of Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in different states of India and also look at some of the factors correlated to the comparative success of states. We also discuss some of the key features of the scheme from the point of view of policy making decisions.
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