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There is an additional argument in favour of feed-in tariffs which is that they're usually considered as net cost for governments whereas they're not. Feed-in tariffs contracts are just a position which a government is taking on the cost of acquisition of energy in the long run. if markets goes up then you might end-up with contract at a lower cost rather than the price on markets and thus a net benefit. This is what French CSPE (the government fund which is paying for the fee-in tariff) experienced in 2007. The total "cost" of the micro hydro contracts was a fact a net benefit. More globally for those who believe in bullish energy markets, feed-in tariffs contract is a way for government to take a low risk long term position on the energy markets and could end up quite quickly in a significant profit generator (very true in my views for what's about buying wind energy at 80€/MWh).
by canopea (canopea@free.fr) on Mon May 4th, 2009 at 10:48:26 AM EST

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