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How critical an international feed-in tariff is, depends on what proportion of total power generation is exported.

That is, if you build assuming that 25% is exported, and the domestic feed-in tariff on the 75% comes close enough to covering the capital cost, then even if the exports sometimes shoot themselves in the foot selling into a marginal cost external market, they'll also sometimes sell into a high marginal cost external market.

On the other hand, a domestic feed-in tariff high enough on a 25% locally consumed share to maintain the resource so that you can sell 75% power on an external market, with both three times as much revenue from the volatile price market and also more frequently shooting yourself in the foot ... that may be untenable, unless you have enough hydro (conventional or pumped) share in your total energy supply to hold power off the export market in low price periods and sell into peak demand pricing.

I'd not be surprised if Sweden was in the "unless" clause at the end of that, using wind power to in effect replace local hydro power consumption and therefore allow more lucrative dispatch hydro into peak demands in export markets.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Jun 25th, 2011 at 03:15:07 PM EST
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