Queensland Solar Feed-In Tariffs and the Merit-Order Effect: Economic Benefit, or Regressive Taxation and Wealth Transfers?

40Citations
Citations of this article
39Readers
Mendeley users who have this article in their library.

Abstract

Premium residential solar feed-in tariffs have come under considerable scrutiny in Australia over the past 12 months following a sharp rise in the uptake of subsidised PV units and subsidy cost blow-outs. Using New South Wales data, Nelson, Simshauser and Kelley (2011) demonstrated that the inherent design of premium 'gross' feed-in tariffs are regressive in nature and required reform. Since the publication of that article in Economic Analysis & Policy (September 2011 edition), feed-in tariff policies have been substantially wound back in all Australian jurisdictions except Queensland. In this article, we examine the 'net' feed-in tariff in Queensland and similarly find it to be a regressive form of taxation. We also examine the so-called 'merit order effect' - a purported 'economic benefit' arising from premium feed-in tariffs. However, the evidence is clear that merit order effects must, by definition, be transient and above all, are not welfare enhancing.

Cite

CITATION STYLE

APA

Nelson, T., Simshauser, P., & Nelson, J. (2012). Queensland Solar Feed-In Tariffs and the Merit-Order Effect: Economic Benefit, or Regressive Taxation and Wealth Transfers? Economic Analysis and Policy, 42(3), 277–301. https://doi.org/10.1016/S0313-5926(12)50030-5

Register to see more suggestions

Mendeley helps you to discover research relevant for your work.

Already have an account?

Save time finding and organizing research with Mendeley

Sign up for free