Rent management and policy learning in green technology development: the case of solar energy in India

Altenburg, Tilman / Tobias Engelmeier
Discussion Paper (12/2012)

Bonn: German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE)

ISBN: 978-3-88985-555-8
Price: 6 €

To avoid irreversible damage to global ecosystems, new “green” technologies are needed. Some of those are still far from commercial maturity. In such cases, governments may create temporary rents to make investments “artificially” attractive. The creation of such rents, however, involves risks of misallocation and political capture. This article looks at rent management in the case of India's National Solar Mission. So far, the mission has been remarkably effective in triggering solar investments and keeping the necessary subsidies manageable through a process of competitive reverse bidding for tariffs. Moreover, policy design and implementation showed a good deal of experimentation and learning. Some risks remain, especially regarding the enforceability of renewable energy quotas at the level of Indian states. On the whole, however, first experiences indicate that “green rents” have been managed in a fairly effective way.

Tobias Engelmeier is Managing Director of BRIDGE TO INDIA Pvt. Ltd. (<link http: www.bridgetoindia.com _blank>www.bridgetoindia.com), a consultancy focused on the Indian solar market.

About the author

Altenburg, Tilman

Economic Geography

Altenburg

Further experts

Aleksandrova, Mariya

Climate risk governance 

Banerjee, Aparajita

Environmental and Resource Sociology, Public Policy 

Baumann, Max-Otto

Political Science 

Brandi, Clara

Economy and Political Science 

Breuer, Anita

Political Scientist 

Dick, Eva

Sociologist and Spatial Planner 

Dippel, Beatrice

Comparatist 

Donnelly, Aiveen

Politcal Science 

Ekoh, Susan S.

Environmental Research 

Fasold, Maximilian

Political Economy 

Goedeking, Nicholas

Comparative Political Economy 

Haldenwang, Christian von

Political Science 

Houdret, Annabelle

Political Scientist 

Lehmann, Ina

Political Science 

Leininger, Julia

Political Scientist 

Mathis, Okka Lou

Political Scientist 

Morare, Ditebogo Modiegi

Political Science 

Never, Babette

Political Scientist 

Nowack, Daniel

Political Science 

Pegels, Anna

Economist 

Roll, Michael

Sociology 

Srigiri, Srinivasa Reddy

Agricultural Economist