"Interactions of Policies for Renewable Energy and Climate" by Cédric Philibert

This paper explores the relationships between climate policy and renewable energy policy instruments. It shows that, even where CO2 emissions are duly priced, specific incentives for supporting the early deployment of renewable energy technologies are justified by the steep learning curves of nascent technologies.



This early investment reduces costs in the longer term and makes renewable energy affordable when it needs to be deployed on a very large scale to fully contribute to climate change mitigation and energy security.
The paper also reveals other noteworthy interaction effects of climate policy and renewable policy instruments on the wholesale electricity prices in deregulated markets, which open new areas for future research.

Table of Contents
Introduction
Criticism of RE incentives
The interaction argument
The cost-effectiveness argument
Supporting RE incentives
Other drivers of RE deployment policies
The need for a longer-term perspective
How are cost reductions best achieved?
Discussion: locking-in, locking-out
Other interaction effects
Conclusion
References
List of figures
Figure 1: Electricity generation by sources in 2007, 2030 and 2050 under Baseline, BLUE Map, BLUE High Nuclear and BLUE High Ren scenarios.
Figure 2: Photovoltaic learning curve 1976-92: linear and log-log representations
Figure 3: PV learning curve
Figure 4: Corporate and public PV R&D expenses
Figure 5: Average wholesale electricity prices and renewable support cost by scenario and major region, 2010‐35
Figure 6: How wind power influences the power spot price at different times of the day
Figure 7: Merit order and electricity price increase with CO2 price