Performance of Renewable Energy Auctions : Experience in Brazil, China and India

This paper considers the design and performance of auction mechanisms used to deploy renewable energy in three emerging economies: Brazil, China, and India. The analysis focuses on the countries' experience in various dimensions, including price reductions, bidding dynamics, coordination with transmission planning, risk allocation strategies, and the issue of domestic content. Several countries have turned to public competitive bidding as a mechanism for developing the renewable generation sector in recent years, with the number of countries implementing some sort of auction procedure rising from nine in 2009 to 36 by the end of 2011 and about 43 in 2013. In general, the use of auctions makes sense when the contracting authority expects a large volume of potentially suitable bids, so that the gains from competition can offset the costs of implementation. A study of the successes and failures of the particular auction design schemes described in this paper can be instrumental in informing future policy making.

Bibliographic Details

Main Authors:	Elizondo Azuela, Gabriela, Barroso, Luiz, Khanna, Ashish, Wang, Xiaodong, Wu, Yun, Cunha, Gabriel
Language:	English en_US
Published:	World Bank Group, Washington, DC 2014-10
Subjects:	ACCESS TO ELECTRICITY, ACCOUNTING, ALLOCATION OF RISK, APPROACH, AUCTION, AUCTION MECHANISM, AUCTION MECHANISMS, AUCTION PRICE, AUCTION PRICES, AUCTION PROCEDURE, AUCTIONS, AVAILABILITY, AVERAGE PRICE, BALANCE, BASES, BID, BIDDING, BIDS, BIOMASS, BOND, BONDS, CALCULATION, CAPACITY FACTOR, CAPACITY FACTORS, CAPACITY UTILIZATION, CLEAN ENERGY, CLEANER ENERGY, CLIMATE, CLIMATE CHANGE, CO, COAL, COMPETITIVE BIDDING, COMPETITIVE MARKET, COMPETITIVE PRICES, COMPETITIVENESS, CONSUMER PRICE, CONSUMER PRICE INDEX, CONVENTIONAL ELECTRICITY, CONVENTIONAL ENERGY, CONVENTIONAL GENERATION, COST OF ENERGY, DEFAULTS, DEMAND FOR ELECTRICITY, DEVALUATION, DEVELOPING COUNTRIES, DEVELOPMENT BANK, DISBURSEMENT, ECONOMIC CRISIS, ECONOMIC EFFICIENCY, ELECTRIC UTILITY, ELECTRICITY, ELECTRICITY CONSUMPTION, ELECTRICITY GENERATION, ELECTRICITY GENERATION MIX, ELECTRICITY PRICES, ELECTRICITY SUPPLY, ELECTRICITY SYSTEM, ELECTRICITY TARIFFS, EMERGING ECONOMIES, EMISSIONS, ENERGY COSTS, ENERGY MARKETS, ENERGY MIX, ENERGY PLANNING, ENERGY POLICIES, ENERGY PRICES, ENERGY SHORTAGES, ENERGY SOURCES, ENERGY SYSTEMS, ENFORCEABILITY, ENVIRONMENTAL SUSTAINABILITY, EQUILIBRIUM PRICES, EXCHANGE RATE, EXCHANGE RATES, FEASIBILITY STUDIES, FEASIBILITY STUDY, FINANCE CORPORATION, FINANCIAL BENEFITS, FINANCIAL HEALTH, FINANCIAL PERFORMANCE, FINANCIAL RISK, FINANCIAL RISKS, FOSSIL, FOSSIL FUEL, FOSSIL FUELS, FREE MARKET, FUEL PRICES, FULL DISCLOSURE, GENERATION CAPACITY, GHG, GOVERNMENT POLICY, GRID RENEWABLE ENERGY, HYDROPOWER, HYDROPOWER GENERATION, INCOME, INDEXATION, INFLATION, INFLATION RISK, INSTITUTIONAL CAPACITY, INSTRUMENT, INTERNATIONAL BANK, INTERNATIONAL COMPETITION, INTERNATIONAL FINANCE, INTERNATIONAL MARKETS, INTERNATIONAL TRADE, IRRADIATION, LIABILITY, LOAN, LOAN REPAYMENT, LOCAL CURRENCY, LOCAL ECONOMY, LOCAL GOVERNMENTS, MANUFACTURING INDUSTRY, MARKET EQUILIBRIUM, MARKET POWER, MARKET PRICE, MARKET PRICES, MARKET REFORM, MARKET STRUCTURE, MONOPOLIES, MONOPOLY, NUCLEAR ENERGY, OFFSHORE WIND, ONSHORE WIND, OPENING PRICE, OUTPUT, PARTICULAR COUNTRY, PAYMENT GUARANTEES, PHOTOVOLTAIC CAPACITY, PHOTOVOLTAICS, PLANT PERFORMANCE, PORTFOLIO, PORTFOLIOS, POTENTIAL INVESTORS, POWER, POWER CORPORATION, POWER GENERATORS, POWER PRICES, POWER SECTOR, POWER SUPPLY, PRICE BENCHMARK, PRICE BENCHMARKS, PRICE CAP, PRICE CEILING, PRICE DISCOVERY, PRICE LEVEL, PRICE LEVELS, PRICE RISK, PRICING SCHEME, PRICING STRATEGY, PRIMARY ENERGY, PRIMARY ENERGY SUPPLY, REGULATORY FRAMEWORK, REGULATORY STRUCTURES, RENEWABLE ELECTRICITY, RENEWABLE ENERGIES, RENEWABLE ENERGY, RENEWABLE ENERGY CAPACITY, RENEWABLE ENERGY DEVELOPMENT, RENEWABLE ENERGY GENERATION, RENEWABLE ENERGY INDUSTRIES, RENEWABLE ENERGY INDUSTRY, RENEWABLE ENERGY MARKET, RENEWABLE ENERGY POLICY, RENEWABLE ENERGY PROGRAM, RENEWABLE ENERGY SOURCES, RENEWABLE GENERATION, RENEWABLE POWER, RENEWABLE RESOURCE, RENEWABLE SOURCES, RENEWABLE SOURCES OF ENERGY, RESERVE, RESERVES, REVERSE AUCTION, RISK FACTORS, SAFETY NET, SALE, SETTLEMENT, SILICON, SOFT LOANS, SOLAR ENERGY, SOLAR POWER, SOLAR RESOURCE, SPOT PRICES, STATE BANK, SUPPLIERS, SUPPLY CHAIN, SURPLUS, SUSTAINABLE ENERGY, TARIFF LEVELS, TAX, TAX CREDIT, TAX STRUCTURES, THERMAL PLANTS, THERMAL POWER, TRACK RECORD, TRACK RECORDS, TRADING, TRANSACTION, TRANSACTION COSTS, TRANSMISSION GRID, TRANSMISSION LINES, TRANSMISSION SYSTEM, TRANSPARENCY, TURBINE MANUFACTURERS, VALUE IN REAL TERMS, VOLATILITY, VOLTAGE, WIND, WIND CAPACITY, WIND DEVELOPMENT, WIND ENERGY, WIND EQUIPMENT, WIND FARM, WIND FARMS, WIND GENERATION, WIND PLANT, WIND PLANTS, WIND POWER, WIND POWER CAPACITY, WIND POWER DEVELOPMENT, WIND POWER GENERATION, WIND POWER INDUSTRY, WIND POWER PLANTS, WIND PRODUCERS, WIND PROJECTS, WIND RESOURCE, WIND RESOURCES, WIND TECHNOLOGY, WIND TURBINE, WIND VELOCITY, WORLD TRADE,
Online Access:	http://documents.worldbank.org/curated/en/2014/10/20291035/performance-renewable-energy-auctions-experience-brazil-china-india https://hdl.handle.net/10986/20498
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