Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/238557 
Year of Publication: 
2020
Series/Report no.: 
ADBI Working Paper Series No. 1200
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
Governments have faced increasing pressure for energy policy to converge around efficiency, sustainability, affordability, and access in recent years. However, separate "silos" rather than an integrated policy framework have addressed these objectives, widening the policy trade-offs. The emergence of market-based reforms and renewable energy technologies has created potential synergies to achieve the objectives. In this paper, we develop a simple analytical framework based on economic efficiency and welfare arguments for the purposeful reallocation of subsidies from fossil fuels to renewable energy. The need to remove poorly targeted fossil fuel subsidies, which generate greater environmental costs, also facilitates this reallocation. Our focus is on utilizing the synergies between market-based reforms and renewables as the electricity sector lies at the confluence of these multiple objectives. We illustrate our framework using experiences from four emerging economies, drawing lessons for policy makers pursuing supply diversification through renewables.
Subjects: 
electricity reform
renewables
emerging economies
subsidies
JEL: 
Q41
Q42
Q48
D61
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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