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Solar Energy: Incentives to Promote PV in EU27

Department of Economic Analysis-Chair of Energy and Environmental Economics-Facultad de CC.Económicas y Empresariales, Ramon y Cajal 1. Seville, 41018, Spain

The growth in the use of renewable energies in the EU has been remarkable. Among these energies is PV. The average annual growth rate for the EU-27 countries in installed PV capacity in the period 2005-2012 was 41.2%. While the installed capacity of PV has reached almost 82 % of National Renewable Energy Action Plan (NREAP) targets for the EU-27 countries for 2020, it is still far from being used at its full potential. Over recent years, several measures have been adopted in the EU to enhance and promote PV. This paper undertakes a complete review of the state of PV power in Europe and the measures taken to date to promote it in EU-27. 25 countries have adopted measures to promote PV. The most widespread measure to promote PV use is Feed- in Tariffs. Tariffs are normally adjusted, in a decreasing manner, annually. Nevertheless, currently, seven countries have decided to accelerate this decrease rate in view of cost reduction of the installations and of higher efficiencies. The second instrument used to promote PV in the EU-27 countries is the concession of subsidies. Nevertheless, subsidies have the disadvantage of being closely linked to budgetary resources and therefore to budgetary constraints. In most EU countries, subsidies for renewable energy for PV are being lowered. Twelve EU-27 countries adopted tax measures. Low-interest loans and green certificate systems were only sparingly used.
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