Table of Contents

Handbook on Energy and Climate Change

Handbook on Energy and Climate Change

Elgar original reference

Edited by Roger Fouquet

This timely Handbook reviews many key issues in the economics of energy and climate change, raising new questions and offering solutions that might help to minimize the threat of energy-induced climate change.

Chapter 9: Economic analysis of feed-in tariffs for generating electricity from renewable energy sources

G. Cornelis van Kooten

Subjects: economics and finance, energy economics, environment, climate change, energy policy and regulation, environmental sociology


The process accompanying the UN’s 1992 Framework Convention on Climate Change (FCCC) culminated in an agreement at the Third Conference of the Parties (COP3) held at Kyoto, Japan, in December 1997. Industrialized nations agreed that, by the first commitment period 2008–12, they would reduce their collective emissions of carbon dioxide and equivalent greenhouse gases (hereafter just CO2) to an average of 5.2 percent below what they were in 1990. Since then, countries have sought to build on Kyoto and reduce CO2 emissions even further in order to address predicted climate change. Given the perceived urgency of addressing global warming, the leaders of the G8 countries agreed at a July 2009 meeting in L’Aquila, Italy, to limit the increase in global average temperature to no more than 2 °C above pre-industrial levels. They would do this by reducing their own greenhouse gas emissions by 80 percent or more, and global emissions by 50 percent, by 2050 relative to 1990 or some more recent year. The European Union (EU) already has in place a ‘20–20–20 target’ – a 20 percent reduction in CO2 emissions from 1990 levels by 2020, with 20 percent of energy to be produced from renewable sources. At COP15 in Copenhagen in late 2009, and again at COP16 in Cancun, Mexico in 2010, the EU was prepared to impose a 30 percent reduction in CO2 emissions by 2020, if there had been some sort of climate agreement.

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