Investment Timing and Social Welfare under Feed-in Tariff Contract
Date
2020
Embargo
Advisor
Coadvisor
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Volume Title
Publisher
CICEE. Universidade Autónoma de Lisboa
Language
English
Alternative Title
Abstract
This paper presents a novel model to analyze the effects on the investment timing and social
welfare of three feed-in tariffs (FIT) within an oligopolistic market structure. The FIT
contracts are the fixed price, the fixed premium, and the minimum price guarantee. The model
allows the identification of the optimal time to deploy a renewable energy project and the
value of the tariff that maximizes the social welfare for each FIT design. These optimal tariffs
generate the same investment timing and the same social welfare.
Keywords
Investment Analysis, Real Options, Feed-In-Tariffs, Uncertainty, Social Welfare, Duopolistic Markets
Document Type
Working paper
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Citation
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Designation
Access Type
Open Access