The Renewable Portfolio Standard in Western Australia — Performance in the Face of Institutional Constraints

Abstract

The Renewable Portfolio Standard (RPS) is a popular method of increasing the portion of renewable energy generation in electricity supplies. The Australian Federal Government introduced a RPS that, in addition to accelerating the uptake of renewable energy, is designed to provide an ongoing base for the development of commercially competitive renewable energy and contribute to the development of an internationally competitive renewable energy industry. The design parameters of the RPS and the existing electricity market framework within which it operates are important considerations in determining the success of this policy initiative in meeting all its objectives. On the basis of the Western Australian experience, this paper argues that while conceptually the RPS may be a useful tool for increasing the portion of electricity generated by renewable resources, and supporting the development of a competitive renewable energy industry, its effectiveness depends upon the policy framework within which it operates.

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