BIG F-I-T REPORT

NREL Issues Massive Feed-in Tariff Design Guide for US
Paul Gipe, August 9, 2010 (Wind-Works)

"…[A Policymaker's Guide to Feed-in Tariff Policy Design] is certainly the longest report any US government agency has ever published on feed-in tariffs, the policy known for the dramatic growth of renewable energy in Europe during the past decade. The report's internal governmental and external peer review alone took more than a year.

"While an extensive analysis of feed-in tariff policies around the globe, the report [from the National Renewable Energy Laboratory of the U.S. Department of Energy] focuses on how these polices can be used in the US. Importantly, the report offers American policy makers a guide to the best practices worldwide and what are the advantages and disadvantages of each design element."

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"The report provides a comprehensive overview of policy options and highlights…Long-term policy stability…Payments based on the cost of generation…Differentiating tariffs by technology, size, location, and resource intensity…Guaranteed access to the grid…Eligibility to all end users and project developers, including some utilities, and a 'Must take' provisions for the electricity generated…[and delves] into the origin of several key provisions in landmark feed-in tariff programs, such as Germany's Renewable Energy Sources Act.

"One design feature often overlooked in North America is differentiating tariffs by resource intensity…The NREL report contains probably one of the most extensive discourses on resource differentiation currently found in English…[It] also emphasizes the positive investment environment that aggressive feed-in tariffs provide…"

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"The NREL report also destroys many of the myths surrounding feed-in tariffs. One myth, for example, is that FIT policies discourage competition. On the contrary, says NREL, the scramble for market share under feed-in tariff polices in Germany, France, and Spain has driven increased private sector research and development, spurring innovation and technological cost reductions…

"…Feed-in tariffs, says NREL, have resulted in the deployment of 15,000 MW of solar PV, and 55,000 MW of wind power from 2000 to 2009 in the European Union…For comparison, there were some 25,000 MW of wind in the US at the end of 2009 and only 1,250 MW of solar PV…According to NREL, feed-in tariffs are responsible for 75% of all solar PV and 45% of all wind development worldwide."