IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v161y2020icp593-605.html
   My bibliography  Save this article

The effectiveness of feed-in-tariff policy in promoting power generation from renewable energy in Kenya

Author

Listed:
  • Ndiritu, S. Wagura
  • Engola, Monica Katungi

Abstract

Feed-in- Tariffs (FIT) policies are used by many developed and developing countries globally as a mechanism to promote renewable energy (RE) development. This study analyses the effectiveness of FIT policy in the deployment of RE, drivers and challenges of the FIT policy in Kenya. In this study, qualitative data analysis adopts a thematic analysis approach whereby common themes are identified. The study reveals that while the policy triggers investment interests, there has been a significant delay in the commercial roll-out of RE projects given the ten-year time lapse following the introduction of the FIT policy. So far, RE generated from FIT projects is very minimal at 10.3 MW against a target of 1551 MW with the majority of the projects being in earlier phases of the process. Therefore, only 0.66% of the target power generation is commercially deployed. Secondly, the study findings show that the key challenges for the FIT policy relate to the unavailability of technical expertise for policy design, and inefficiencies in policy implementation. The main recommendation from this study is that the FIT policy should be revised to address the challenges associated with it, and retained for projects below 10 MW, and the auction mechanism should be introduced for projects above 10 MW.

Suggested Citation

  • Ndiritu, S. Wagura & Engola, Monica Katungi, 2020. "The effectiveness of feed-in-tariff policy in promoting power generation from renewable energy in Kenya," Renewable Energy, Elsevier, vol. 161(C), pages 593-605.
    • Handle: RePEc:eee:renene:v:161:y:2020:i:c:p:593-605
    DOI: 10.1016/j.renene.2020.07.082
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148120311587
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2020.07.082?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Moner-Girona, M. & Solano-Peralta, M. & Lazopoulou, M. & Ackom, E.K. & Vallve, X. & Szabó, S., 2018. "Electrification of Sub-Saharan Africa through PV/hybrid mini-grids: Reducing the gap between current business models and on-site experience," Renewable and Sustainable Energy Reviews, Elsevier, vol. 91(C), pages 1148-1161.
    2. Fagiani, Riccardo & Barquín, Julián & Hakvoort, Rudi, 2013. "Risk-based assessment of the cost-efficiency and the effectivity of renewable energy support schemes: Certificate markets versus feed-in tariffs," Energy Policy, Elsevier, vol. 55(C), pages 648-661.
    3. Butler, Lucy & Neuhoff, Karsten, 2008. "Comparison of feed-in tariff, quota and auction mechanisms to support wind power development," Renewable Energy, Elsevier, vol. 33(8), pages 1854-1867.
    4. Rickerson, Wilson & Hanley, Christina & Laurent, Chad & Greacen, Chris, 2013. "Implementing a global fund for feed-in tariffs in developing countries: A case study of Tanzania," Renewable Energy, Elsevier, vol. 49(C), pages 29-32.
    5. Tongsopit, Sopitsuda & Greacen, Chris, 2013. "An assessment of Thailand's feed-in tariff program," Renewable Energy, Elsevier, vol. 60(C), pages 439-445.
    6. Kylili, Angeliki & Fokaides, Paris A., 2015. "Competitive auction mechanisms for the promotion renewable energy technologies: The case of the 50MW photovoltaics projects in Cyprus," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 226-233.
    7. Moner-Girona, M. & Ghanadan, R. & Solano-Peralta, M. & Kougias, I. & Bódis, K. & Huld, T. & Szabó, S., 2016. "Adaptation of Feed-in Tariff for remote mini-grids: Tanzania as an illustrative case," Renewable and Sustainable Energy Reviews, Elsevier, vol. 53(C), pages 306-318.
    8. Eid, Cherrelle & Reneses Guillén, Javier & Frías Marín, Pablo & Hakvoort, Rudi, 2014. "The economic effect of electricity net-metering with solar PV: Consequences for network cost recovery, cross subsidies and policy objectives," Energy Policy, Elsevier, vol. 75(C), pages 244-254.
    9. Kim, Kyoung-Kuk & Lee, Chi-Guhn, 2012. "Evaluation and optimization of feed-in tariffs," Energy Policy, Elsevier, vol. 49(C), pages 192-203.
    10. Sakah, Marriette & Diawuo, Felix Amankwah & Katzenbach, Rolf & Gyamfi, Samuel, 2017. "Towards a sustainable electrification in Ghana: A review of renewable energy deployment policies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 79(C), pages 544-557.
    11. Saed Alizamir & Francis de Véricourt & Peng Sun, 2016. "Efficient Feed-In-Tariff Policies for Renewable Energy Technologies," Operations Research, INFORMS, vol. 64(1), pages 52-66, February.
    12. Lin, Boqiang & Wesseh, Presley K., 2013. "Valuing Chinese feed-in tariffs program for solar power generation: A real options analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 28(C), pages 474-482.
    13. Kazimierczuk, Agnieszka H., 2019. "Wind energy in Kenya: A status and policy framework review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 107(C), pages 434-445.
    14. United Nations UN, 2015. "Transforming our World: the 2030 Agenda for Sustainable Development," Working Papers id:7559, eSocialSciences.
    15. Stambouli, Amine Boudghene, 2011. "Promotion of renewable energies in Algeria: Strategies and perspectives," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(2), pages 1169-1181, February.
    16. Walker, S.L., 2012. "Can the GB feed-in tariff deliver the expected 2% of electricity from renewable sources?," Renewable Energy, Elsevier, vol. 43(C), pages 383-388.
    17. Hazelton, James & Bruce, Anna & MacGill, Iain, 2014. "A review of the potential benefits and risks of photovoltaic hybrid mini-grid systems," Renewable Energy, Elsevier, vol. 67(C), pages 222-229.
    18. Fluri, Thomas P., 2009. "The potential of concentrating solar power in South Africa," Energy Policy, Elsevier, vol. 37(12), pages 5075-5080, December.
    19. Bhamidipati, Padmasai Lakshmi & Haselip, James & Elmer Hansen, Ulrich, 2019. "How do energy policies accelerate sustainable transitions? Unpacking the policy transfer process in the case of GETFiT Uganda," Energy Policy, Elsevier, vol. 132(C), pages 1320-1332.
    20. Malhotra, Abhishek & Schmidt, Tobias S. & Haelg, Leonore & Waissbein, Oliver, 2017. "Scaling up finance for off-grid renewable energy: The role of aggregation and spatial diversification in derisking investments in mini-grids for rural electrification in India," Energy Policy, Elsevier, vol. 108(C), pages 657-672.
    21. Ramírez, F. Javier & Honrubia-Escribano, A. & Gómez-Lázaro, E. & Pham, Duc T., 2017. "Combining feed-in tariffs and net-metering schemes to balance development in adoption of photovoltaic energy: Comparative economic assessment and policy implications for European countries," Energy Policy, Elsevier, vol. 102(C), pages 440-452.
    22. Atalay, Yasemin & Kalfagianni, Agni & Pattberg, Philipp, 2017. "Renewable energy support mechanisms in the Gulf Cooperation Council states: Analyzing the feasibility of feed-in tariffs and auction mechanisms," Renewable and Sustainable Energy Reviews, Elsevier, vol. 72(C), pages 723-733.
    23. Ramli, Makbul A.M. & Twaha, Ssennoga, 2015. "Analysis of renewable energy feed-in tariffs in selected regions of the globe: Lessons for Saudi Arabia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 45(C), pages 649-661.
    24. Goutam Dutta & Krishnendranath Mitra, 2017. "A literature review on dynamic pricing of electricity," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 68(10), pages 1131-1145, October.
    25. Ismail, Abdul Muhaimin & Ramirez-Iniguez, Roberto & Asif, Muhammad & Munir, Abu Bakar & Muhammad-Sukki, Firdaus, 2015. "Progress of solar photovoltaic in ASEAN countries: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 48(C), pages 399-412.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Setiawan, Andri D. & Dewi, Marmelia P. & Jafino, Bramka Arga & Hidayatno, Akhmad, 2022. "Evaluating feed-in tariff policies on enhancing geothermal development in Indonesia," Energy Policy, Elsevier, vol. 168(C).
    2. Shen, Wei & Ayele, Seife & Worako, Tadesse Kuma, 2023. "The political economy of green industrial policy in Africa: Unpacking the coordination challenges in Ethiopia," Energy Policy, Elsevier, vol. 179(C).
    3. Emília Inês Come Zebra & Gilberto Mahumane & Federico Antonio Canu & Ana Cardoso, 2021. "Assessing the Greenhouse Gas Impact of a Renewable Energy Feed-in Tariff Policy in Mozambique: Towards NDC Ambition and Recommendations to Effectively Measure, Report, and Verify Its Implementation," Sustainability, MDPI, vol. 13(10), pages 1-21, May.
    4. Wu, Jiaqian & Chen, Yu & Yu, Lean & Li, Guohao & Li, Jingjing, 2023. "Has the evolution of renewable energy policies facilitated the construction of a new power system for China? A system dynamics analysis," Energy Policy, Elsevier, vol. 183(C).
    5. Tsai, I-Chun, 2024. "Fossil energy risk exposure of the UK electricity system: The moderating role of electricity generation mix and energy source," Energy Policy, Elsevier, vol. 188(C).
    6. Chankook Park & Minkyu Kim, 2021. "A Study on the Characteristics of Academic Topics Related to Renewable Energy Using the Structural Topic Modeling and the Weak Signal Concept," Energies, MDPI, vol. 14(5), pages 1-24, March.
    7. Ayele, Seife & Shen, Wei & Mulugetta, Yacob & Worako, Tadesse Kuma, 2024. "Governance of renewable energy procurement via private suppliers: The Ethiopian experience," Energy Policy, Elsevier, vol. 184(C).
    8. Ba, Zhichao & Ma, Yaxue & Cai, Jinyao & Li, Gang, 2023. "A citation-based research framework for exploring policy diffusion: Evidence from China's new energy policies," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    9. Xu, Tiantong & Mo, Lipo & Liu, Diyi, 2024. "Feed-in tariff or sheep farming subsidy? Implications of promoting photovoltaic energy by solar sheep raising," Energy Policy, Elsevier, vol. 184(C).
    10. Zhou, Dequn & Dong, Zhuojia & Sang, Xiuzhi & Wang, Qunwei & Yu, Xianyu, 2023. "Do feed-in tariff reduction and green certificate trading effectively promote regional sustainable development？," Energy, Elsevier, vol. 283(C).
    11. Lin, Boqiang & Xie, Yongjing, 2024. "How feed-in-tariff subsidies affect renewable energy investments in China? New evidence from firm-level data," Energy, Elsevier, vol. 294(C).
    12. Dong, Zhuojia & Yu, Xianyu & Chang, Ching-Ter & Zhou, Dequn & Sang, Xiuzhi, 2022. "How does feed-in tariff and renewable portfolio standard evolve synergistically? An integrated approach of tripartite evolutionary game and system dynamics," Renewable Energy, Elsevier, vol. 186(C), pages 864-877.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ritzenhofen, Ingmar & Birge, John R. & Spinler, Stefan, 2016. "The structural impact of renewable portfolio standards and feed-in tariffs on electricity markets," European Journal of Operational Research, Elsevier, vol. 255(1), pages 224-242.
    2. de Oliveira, Lucas Guedes & Aquila, Giancarlo & Balestrassi, Pedro Paulo & de Paiva, Anderson Paulo & de Queiroz, Anderson Rodrigo & de Oliveira Pamplona, Edson & Camatta, Ulisses Pessin, 2020. "Evaluating economic feasibility and maximization of social welfare of photovoltaic projects developed for the Brazilian northeastern coast: An attribute agreement analysis," Renewable and Sustainable Energy Reviews, Elsevier, vol. 123(C).
    3. Zafirakis, D. & Chalvatzis, K. & Kaldellis, J.K., 2013. "“Socially just” support mechanisms for the promotion of renewable energy sources in Greece," Renewable and Sustainable Energy Reviews, Elsevier, vol. 21(C), pages 478-493.
    4. Zhang, M.M. & Zhou, D.Q. & Zhou, P. & Chen, H.T., 2017. "Optimal design of subsidy to stimulate renewable energy investments: The case of China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 71(C), pages 873-883.
    5. Niall Farrell, Mel T. Devine, William T. Lee, James P. Gleeson, and Sean Lyons, 2017. "Specifying An Efficient Renewable Energy Feed-in Tariff," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2).
    6. Ramli, Makbul A.M. & Twaha, Ssennoga, 2015. "Analysis of renewable energy feed-in tariffs in selected regions of the globe: Lessons for Saudi Arabia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 45(C), pages 649-661.
    7. Coria, Gustavo & Penizzotto, Franco & Pringles, Rolando, 2019. "Economic analysis of photovoltaic projects: The Argentinian renewable generation policy for residential sectors," Renewable Energy, Elsevier, vol. 133(C), pages 1167-1177.
    8. Rossi, Federico & Heleno, Miguel & Basosi, Riccardo & Sinicropi, Adalgisa, 2021. "LCA driven solar compensation mechanism for Renewable Energy Communities: the Italian case," Energy, Elsevier, vol. 235(C).
    9. Yao, Xing & Fan, Ying & Zhu, Lei & Zhang, Xian, 2020. "Optimization of dynamic incentive for the deployment of carbon dioxide removal technology: A nonlinear dynamic approach combined with real options," Energy Economics, Elsevier, vol. 86(C).
    10. Vassilis Stavrakas & Nikos Kleanthis & Alexandros Flamos, 2020. "An Ex-Post Assessment of RES-E Support in Greece by Investigating the Monetary Flows and the Causal Relationships in the Electricity Market," Energies, MDPI, vol. 13(17), pages 1-29, September.
    11. Aquila, Giancarlo & Pamplona, Edson de Oliveira & Queiroz, Anderson Rodrigo de & Rotela Junior, Paulo & Fonseca, Marcelo Nunes, 2017. "An overview of incentive policies for the expansion of renewable energy generation in electricity power systems and the Brazilian experience," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 1090-1098.
    12. Yong Long & Yu Wang & Chengrong Pan, 2017. "Auction Mechanism of Micro-Grid Project Transfer," Sustainability, MDPI, vol. 9(10), pages 1-20, October.
    13. Zhang, Ruixiaoxiao & Shimada, Koji & Ni, Meng & Shen, Geoffrey Q.P. & Wong, Johnny K.W., 2020. "Low or No subsidy? Proposing a regional power grid based wind power feed-in tariff benchmark price mechanism in China," Energy Policy, Elsevier, vol. 146(C).
    14. Zhang, M.M. & Zhou, D.Q. & Zhou, P. & Liu, G.Q., 2016. "Optimal feed-in tariff for solar photovoltaic power generation in China: A real options analysis," Energy Policy, Elsevier, vol. 97(C), pages 181-192.
    15. Abolhosseini, Shahrouz & Heshmati, Almas, 2014. "The main support mechanisms to finance renewable energy development," Renewable and Sustainable Energy Reviews, Elsevier, vol. 40(C), pages 876-885.
    16. Sachiko Graber & Tara Narayanan & Jose F. Alfaro & Debajit Palit, 2019. "Perceptions towards solar mini‐grid systems in India: A multi‐stakeholder analysis," Natural Resources Forum, Blackwell Publishing, vol. 43(4), pages 253-266, November.
    17. Koumparou, Ioannis & Christoforidis, Georgios C. & Efthymiou, Venizelos & Papagiannis, Grigoris K. & Georghiou, George E., 2017. "Configuring residential PV net-metering policies – A focus on the Mediterranean region," Renewable Energy, Elsevier, vol. 113(C), pages 795-812.
    18. Pineda, Salvador & Boomsma, Trine K. & Wogrin, Sonja, 2018. "Renewable generation expansion under different support schemes: A stochastic equilibrium approach," European Journal of Operational Research, Elsevier, vol. 266(3), pages 1086-1099.
    19. Barroco, Jose & Herrera, Maria, 2019. "Clearing barriers to project finance for renewable energy in developing countries: A Philippines case study," Energy Policy, Elsevier, vol. 135(C).
    20. Robert Marschinski & Philippe Quirion, 2014. "Tradable Renewable Quota vs. Feed-In Tariff vs. Feed-In Premium under Uncertainty," Working Papers 2014.99, Fondazione Eni Enrico Mattei.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:renene:v:161:y:2020:i:c:p:593-605. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.