Performance of Renewable Energy Auctions: Experience in Brazil, China and India

Azuela, Gabriela Elizondo; Barroso, L.A.; Khanna, Ashish; Wang, Xiaodong; Wu, Yun Na; Cunha, Gabriel

doi:10.1596/1813-9450-7062

Cited by 19 publications

(16 citation statements)

References 34 publications

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“…Auctions, covering three quarters of the domestic electricity market, are the primary policy instrument for expanding and diversifying the renewable power supply since the Lula administration (Azuela et al 2014). Auctions were initially introduced within the context of the Programa de Incentivo às Fontes Alternativas de Energia Elétrica (PROINFA), the first major instrument for expanding and diversifying the renewable electricity supply, which was created under the Cardoso administration in 2002 and originally based on Feed-in Tariffs (Dutra and Szklo 2008;Aquila et al 2017).…”

Section: Instrument Designmentioning

confidence: 99%

The Brazilian renewable energy policy framework: instrument design and coherence

Fraundorfer

Rabitz

2020

Climate Policy

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In the context of Brazil's rising energy-related greenhouse gas (GHG) emissions, we develop a forwardlooking analysis of the domestic renewable energy policy framework. We probe the overall effectiveness of this framework by focusing on instrument design (in terms of stringency and predictability) as well as policy coherence. We analyze the development of solar, wind and hydropower, as well as biodiesel and ethanol, in the period between 2003 and 2018. We find strong increases in stringency for biodiesel, solar and wind power, marginal ones for ethanol, and decreasing ones for hydropower. Predictability presents a consistent challenge for policy effectiveness, with the exception of biodiesel. Overall policy coherence improves with fossil fuel subsidy reductions after 2014, although the complex environmental licensing regime as well as ad hoc fiscal interventions and price controls in the fuel markets create tensions for biofuels expansion. The policy framework as it has evolved through the period under consideration is neither likely to slow down/reverse the growth trend in natural gas consumption for power generation, nor to significantly alter the fuel mix in light-vehicle transportation. Considering that improvements in the policy framework are partially driven by non-climate rationales, we conclude that rising energyrelated GHG emissions will increasingly challenge Brazil's contribution to international temperature targets while diminishing its stature in global climate diplomacy. Key policy insights• Renewable energy policies in Brazil suffer from a lack of predictability.• While recent reductions in fossil fuel subsidies have improved policy coherence, significant incoherencies between policy instruments impede renewable energy expansion.• Increasingly ambitious expansion targets for solar and wind power will need to close the supply gap resulting from the relative decline of hydropower in order to avoid further increases in natural gas consumption.• Although the Bolsonaro administration has not created substantial policy changes so far, it introduces additional uncertainties regarding long-term decarbonization, while also diminishing Brazil's diplomatic stature in international negotiations.

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Section: Instrument Designmentioning

confidence: 99%

The Brazilian renewable energy policy framework: instrument design and coherence

Fraundorfer

Rabitz

2020

Climate Policy

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“…In contrast, reverse auctions (in which sellers bid for the prices at which they are willing to sell) introduce competition and push prices down toward production costs (Azuela et al 2014, andIRENA 2018). In India, for example, the National Solar Mission implemented reverse auctions for 25-year fixed price contracts beginning in 2010.…”

Section: Subsidies Can Encourage Generation Of Electricity From Renewable Sourcesmentioning

confidence: 99%

Greening Markets:

2021

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The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent.ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by ADB in preference to others of a similar nature that are not mentioned.By making any designation of or reference to a particular territory or geographic area, or by using the term "country" in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area.

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“…With little prior experience, there would be an initial consideration of the actual costs in Myanmar. For example, the price levels achieved through energy auctions can vary depending on their design elements [84][85][86][87][88][89].…”

Section: Decreasing Global Prices Of Solar Energy (O3)mentioning

confidence: 99%

A SWOT Analysis of Utility-Scale Solar in Myanmar

Alvarez

Sugiyama

2020

Energies

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Myanmar remains one of the few exceptions to the rapid diffusion of solar photovoltaics (PV) in power generation mixes. This is surprising considering that Myanmar is one of the countries with the largest technical potential for solar energy among Southeast Asian nations. Solar energy can complement the existing hydropower generation to address endemic energy crisis during the dry season. A continuation of paralysis on investments in solar energy could affect the security and sustainability of the sector in one of the most rapidly growing countries in the region. In this paper, we aimed to identify the barriers preventing solar energy to flourish in Myanmar and to identify policy options to unlock them. We conducted a SWOT (strengths, weaknesses, opportunities, and threats) analysis with inputs from relevant stakeholders from the government, private sector, and civil society organizations. Our analysis suggested a consensus on the merits of solar energy among all factors; however, a policy framework to spur investments that contribute both to the national energy system and local development needs to be developed by considering some particularities of Myanmar, such as securing rightful land ownership and limited experience with market mechanisms (e.g., energy auction), for the promotion of investments in the energy sector.

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Performance of Renewable Energy Auctions: Experience in Brazil, China and India

Cited by 19 publications

References 34 publications

The Brazilian renewable energy policy framework: instrument design and coherence

The Brazilian renewable energy policy framework: instrument design and coherence

Greening Markets:

A SWOT Analysis of Utility-Scale Solar in Myanmar

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