7 Will a Transition to Renewable Energy Promote …
255
to have low and medium technical risks. Nigeria has a significant amount
of some of these renewables and can be effectively deployed.
The identified different barriers to RES-E undertaking can be justified by the choice of different energy mix policies.
104 There are different
policy tools identifiable to address such barriers.
105 The most often
applied option, in particular, for economic and financial barriers are
FITs and feed-in-premiums (FIPs).
106 The mechanism of FITs allows
for a complete payment per MWh of generated RES-E by way of guaranteed prices, and as a combination of a procurement requirement by
the utilities.
107 FIPs are usually a payment granted on the wholesale
market price of electricity per kWh.
108 The former has been used in a
number of African countries such as Ghana, South Africa, Kenya,
109
although mixed feelings indicate that it only provided a small fraction
of investments in these countries, remarkably, renewable energy auction
has emerged as a very increasingly important mechanism to foster electricity generation from renewable sources.
110 Most countries are now
adopting it as an appealing option to address barriers to RES-E investments, given its success in South Africa and beyond.
111 Defined as a
‘process in which a good or several goods are offered up for bidding’, the
auction offers a procurement mechanism by which an auctioneer buys
a ‘good’, in this context, RES-E from bidders offering the best bid such
as least support level.
112 There is an underlying argument that auction
is advantageous over some kinds of administrative set-support mechanisms such as FITs.
113 For example, the auction offers a higher level
of transparency for support levels- market prices and limits support to
104 Lucas, del Rio and Sokona (n 86)
105 Pueyo and others (n 87).
106 Lucas, del Rio and Sokona (n 86).
107 Ibid.
108 Ibid.
109 Ibid.
110 IRENA, Renewable Energy Auctions: Cases from Sub-Saharan Africa (Abu Dhabi: IRENA
2018)
111 Lucas, del Rio and Sokona (n 86).
112 AURES, ‘About Auctions’, http://auresproject.eu/about-auctions, accessed 18 April 2020.
113 Lucas, del Rio and Sokona (n 86).
255
to have low and medium technical risks. Nigeria has a significant amount
of some of these renewables and can be effectively deployed.
The identified different barriers to RES-E undertaking can be justified by the choice of different energy mix policies.
104 There are different
policy tools identifiable to address such barriers.
105 The most often
applied option, in particular, for economic and financial barriers are
FITs and feed-in-premiums (FIPs).
106 The mechanism of FITs allows
for a complete payment per MWh of generated RES-E by way of guaranteed prices, and as a combination of a procurement requirement by
the utilities.
107 FIPs are usually a payment granted on the wholesale
market price of electricity per kWh.
108 The former has been used in a
number of African countries such as Ghana, South Africa, Kenya,
109
although mixed feelings indicate that it only provided a small fraction
of investments in these countries, remarkably, renewable energy auction
has emerged as a very increasingly important mechanism to foster electricity generation from renewable sources.
110 Most countries are now
adopting it as an appealing option to address barriers to RES-E investments, given its success in South Africa and beyond.
111 Defined as a
‘process in which a good or several goods are offered up for bidding’, the
auction offers a procurement mechanism by which an auctioneer buys
a ‘good’, in this context, RES-E from bidders offering the best bid such
as least support level.
112 There is an underlying argument that auction
is advantageous over some kinds of administrative set-support mechanisms such as FITs.
113 For example, the auction offers a higher level
of transparency for support levels- market prices and limits support to
104 Lucas, del Rio and Sokona (n 86)
105 Pueyo and others (n 87).
106 Lucas, del Rio and Sokona (n 86).
107 Ibid.
108 Ibid.
109 Ibid.
110 IRENA, Renewable Energy Auctions: Cases from Sub-Saharan Africa (Abu Dhabi: IRENA
2018)
111 Lucas, del Rio and Sokona (n 86).
112 AURES, ‘About Auctions’, http://auresproject.eu/about-auctions, accessed 18 April 2020.
113 Lucas, del Rio and Sokona (n 86).