Powering Demand: Solar Photovoltaic Subsidies in California Public Deposited
- Last Modified
- March 19, 2019
- Creator
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Reddix, Kenneth, II
- Affiliation: College of Arts and Sciences, Department of Economics
- Abstract
- Households' decisions to purchase solar photovoltaic systems are characterized by large upfront costs, differentiated products, and uncertainties about future government subsidies. This study analyzes the interplay of these factors using a dynamic discrete choice model. I use a newly assembled dataset, that covers all installations from 2002 through 2006 in California at the household level, to estimate demand for solar panel installations. I find that across the distribution of housing values, households are price elastic with respect to both temporary and permanent changes in price. Also, I find that elasticities vary across the distribution of housing values. The marginal effect of technological innovation is significant and positive with respect to the probability of purchase. I find that a 1% increase in the efficiency rate increases the probability of purchase by 6.4%. This is result is compounded by the fact that efficiency rates increase 30% over the sample period. Through counterfactual simulations, I show that in the absence of government subsidies 49.5% of all purchases would not have occurred. Additionally, over 70% of the total reduction in market capacity when subsidies are removed is directly attributable to larger capacity installations. Lastly, I find no evidence that household behavior is affected by the uncertainty associated with future subsidy regimes.
- Date of publication
- August 2015
- Keyword
- Subject
- DOI
- Identifier
- Resource type
- Rights statement
- In Copyright
- Advisor
- Joubert, Clement
- McManus, Brian
- Tauchen, Helen
- Gilleskie, Donna B.
- Yates, Andrew
- Degree
- Doctor of Philosophy
- Degree granting institution
- University of North Carolina at Chapel Hill Graduate School
- Graduation year
- 2015
- Language
- Publisher
- Place of publication
- Chapel Hill, NC
- Access
- There are no restrictions to this item.
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This work has no parents.
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