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Stable Policies – Turbulent Markets Germany’s Green Industrial Policy: The Costs and Benefits of Promoting solar PV and Wind Energy

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Wilfried Lütkenhorst, Anna Pegels, German Development Institute
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This report addresses the much-debated challenge of Germany’s energy transition (Energiewende) and reviews the policy measures taken in support of increasing the share of renewables in the country’s energy mix. The authors emphasize solar photovoltaic (PV) and wind energy, analyze the evolution of both sectors in Germany, assess the costs and benefits associated with support policies and report some lessons concerning the need to reform the feed-in tariff approach and to consider the broader issues of green industrial policy. The report finds mixed evidence that Germany reaches its green industrial policy aims at reasonable costs.