Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/319889 
Year of Publication: 
2025
Series/Report no.: 
ZEW Discussion Papers No. 25-018
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
We study Germany's photovoltaic (PV) subsidy program, estimating a dynamic model of new technology adoption which accounts for heterogeneity in residential ownership structures. We find that homeowner and landlord investors heavily discount future benefits, highlighting the suboptimality of the feed-in tariff structure and the inefficient use of government funds. The high administrative costs associated with tenant electricity contracts strongly discourage landlords from investing in new energy technologies. Our analysis suggests that policy design should prioritize upfront investment subsidies over feed-in tariffs to promote renewable energy adoption. Reducing administrative costs associated with tenant electricity programs is key to unlock investments by landlords and expand tenants' access to solar energy, thereby enhancing cost-effectiveness.
Subjects: 
Renewable Energy
Subsidies
Germany
Households
Undervaluation
Cost-Effectiveness
JEL: 
C51
D15
Q48
Q58
Document Type: 
Working Paper

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