Major barriers to renewable energy

While most renewable fuels are free, renewable energy projects have high up-front costs, and a number of factors combine to make many renewable energies more expensive than conventional energy. Distortions resulting from unequal tax burdens and existing subsidies, and the failure to internalize all costs and benefits of energy production and use, erect high barriers to RETs. Additional cost barriers range from the cost of technologies themselves (and the need to achieve economies of scale in production) to the lack of access to affordable credit, and the costs of connecting with the grid and transmission charges, which often penalize intermittent energy sources. Import duties on RETs and components also act to make renewable energy more costly. As a result, many of the cost barriers to renewables are perceived rather than real.

In many countries, electric utilities maintain monopoly rights to produce, transmit and distribute electricity. High costs or a lack of standards for connection and transmission also discourage renewable energy projects. And everywhere, renewable energy must compete with financial and regulatory systems that have evolved to promote the development and use of fossil fuels and nuclear power, and that often discriminate against the use of RETs.

In addition, lack of information about available renewable energy resources and about the current state of RETs, misperceptions, lack of experience or training, negative past experiences with old technologies, and a lack of understanding about the benefits associated with renewable energy all act as barriers to their use. Each of these factors works to increase the perceived risks — technical and financial — of investing in renewable energy.

For the most part, barriers in developing countries are similar to those in the industrial world. However, specific national characteristics, particularly within the developing world, can play an important role in determining barriers from one country to the next. Additional obstacles in many developing countries include long travel distances to remote areas, poor transport and communication infrastructure, lack of trained personnel, and low literacy rates (Martinot et al, 2002). In addition, the perceived risk of investing in renewable energy projects in developing countries is high, owing to uncertainties about political, regulatory and market stability (Frost, 2003). In the past, donor aid has inhibited commercial markets, often reducing perceived value of RETs (if they are free), while focusing little on models of development that can be viable, sustainable and replicable. And if people expect to be connected to the grid soon, as a result of unrealistic plans for grid extension or political promises, there is no incentive to invest in alternatives (Martinot, 2003).

Finally, even government policies that are enacted to promote RETs can have negative impacts if they are inappropriate, inconsistent, or are too short-term.

Solar Power Sensation V2

Solar Power Sensation V2

This is a product all about solar power. Within this product you will get 24 videos, 5 guides, reviews and much more. This product is great for affiliate marketers who is trying to market products all about alternative energy.

Get My Free Ebook

Post a comment