Why Hasn't America Embraced Feed-In Tariffs?

Brian has already made the case for why feed-in tariffs rule in promoting clean energy, and while the UK government's stinging u-turn remains a case study in how not to do them, Germany's more measured reduction in solar subsidies shows, Feed in Tariffs (FiTs) are widely regarded as the most effective policy measure for promoting renewables that we have available to us. So it's no wonder that Peter Lynch over at Renewable Energy World is asking why America has not yet embraced FiTs. It's interesting, he suggests, to note the experience of China as it readied its now formidable clean energy economy for rapid expansion:

...it is interesting to note that in 2006 China avoided implementing a FIT because “FITs trigger such rapid market growth,” according to an unnamed Chinese official. I would certainly view this as a compliment to the effectiveness of a well-designed FIT. Perhaps the Chinese realized that their solar manufacturing base was not in place to address this potentially explosive market?

In 2011 the Chinese implemented a FIT program, their domestic market is now booming and coincidently, Chinese solar manufacturing has scaled up to the point where they can address this huge market without the help of imports.

Is it too late for America to lead?

Tags: Economics | Renewable Energy | United States