@article{Darmstadter:10777, recid = {10777}, author = {Darmstadter, Joel}, title = {The Economic and Policy Setting of Renewable Energy: Where Do Things Stand?}, address = {2003}, number = {1318-2016-103171}, series = {Discussion Paper 03-64}, pages = {21}, year = {2003}, abstract = {This paper looks at the status and prospects of renewables-with particular emphasis on windpower-in the electric power sector. Although renewables account for a steadily rising share of electricity generation in various countries, their role remains small in absolute terms. In part, this is because of technological progress of and successful competition from fossil-fueled generation-notably, combined cycle gas turbines. While diminishing, subsidies continue to be indispensable to the use of renewables in most places. Viability of renewables-based electricity is undermined by the cost of externalities for which fossil energy combustion is only partially charged. A number of countries (and states in the U.S.) have launched obligatory requirements for renewables-based electricity in the years ahead. This so-called "renewable portfolio standard," while technology-forcing, offers an opportunity for an economically efficient way of promoting greater market penetration of renewables.}, url = {http://ageconsearch.umn.edu/record/10777}, doi = {https://doi.org/10.22004/ag.econ.10777}, }