PRICING OF RENEWABLE ENERGY

Abstract

For Pricing of Renewable Energy, there are two main aspects. First one is the policy and second one is pricing mechanism. In policies there are different practices like Feed in tariff, Competitive Bidding, Renewable Portfolio System, Renewable Energy Credits and Fiscal incentives. In the thesis work, these policies and practices have been discussed. It has been found that the stepped feed in tariff system with fiscal incentives appears to be best instrument for promoting Renewable Energy. For future, Renewable Energy Credits may be a successful scheme for deregulated market. So far as pricing of non firm power is concerned cost based tariff and avoided cost method are found to be suitable methods but for Indian scenario cost based method appears to be more suitable because of a huge gap between supply and demand. Effect of Subsidy and CDM benefits for renewable energies have been also analysed and their impacts have been discussed on the pricing strategy. It has been concluded that for hydro power, which is a mature technology, CDM incentives are enough to make it comparable with conventional energy resources. However for wind power, which is a developing technology, there is need for subsidy and CDM incentives to make its price comparable to conventional energy resources.