Investment And Environmental Attractiveness In The Absence Of Government Subsidies
Abstract
Renewable energy alternatives are often subject to criticism with respect to relying on government subsidies. In considering the merit of this criticism it is necessary to examine the definition of subsidies and consider how the details impact renewable energies from a microeconomic decision making level. It becomes apparent that the existing energy infrastructure has been the recipient of subsidies that have evolved into government policies and are now over looked. To further sustainable decisions for investment in the electricity market thei mpact of select subsidies on different energy sources is undertaken. The goal is to determine if renewable options can compete with coal in the absence of subsidies. The analysis is foccused on coal, wind, and geothermal resources available in Alberta. The analysis shows the market distortion of price support subsidies, which encourages investment in projects that provide incremental results, whereas strong policies can foster long-term growth in an industry.