Renewable energy policy performance in reducing CO2 emissions

- We study the performance of renewable-energy policies in reducing CO2 emissions.
- A relevant question is which renewable energy policy is the most cost-efficient.
- Within oligopolistic competition, the answer is sensitive to the system operation.
- Significant changes can be observed when considering or ignoring reserve constraints.

The growth of fossil fuel power production and the consequent increase in the level of carbon dioxide (CO2) emissions have set off an alarm signal worldwide. Different policies have been implemented to incentivize the development of renewable energy sources with the goal of reducing CO2 emissions. Notwithstanding the different policies contribute to reduce greenhouse gas emissions through the incentives provided for renewable energy, a relevant question is which of these is the most efficient. However, within the context of oligopolistic competition, the answer is very sensitive to the operation of the system. In particular, significant changes in the results can be observed when considering or ignoring reserve constraints.