Do renewable electricity policies promote renewable electricity generation? Evidence from panel data

Using the Poisson pseudo-maximum likelihood estimation technique, this paper evaluates the effects of renewable electricity policies on renewable electricity generation using a large panel dataset that covers 122 countries over the period of 1980-2010. The results suggest that renewable electricity policies play a crucial role in promoting renewable electricity generation, but their effectiveness is subject to diminishing returns as the number of policies increases. There is also evidence that the effects of renewable electricity policies are more pronounced before 1996 as well as in developed and emerging market countries, and the negative policy interaction effect fades with the stage of economic development. Lastly, policy effectiveness varies by the type of renewable electricity policy and energy source. Only investment incentives and feed-in tariffs are found to be effective in promoting the development of all types of renewable energy sources for electricity considered in this paper.