Subsidies Examples: Renewable Energy Incentives

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Waste-to-energy incineration recovers energy from discarded municipal solid waste and produces electricity and/or steam for heating. Although there are significant environmental benefits of using waste fuel energy instead of or in addition to fossil fuel energy, renewable energy from waste cannot compete in the current market without financial incentives. Expanding waste-to-energy incineration approach is economically feasible only when the fuel is delivered at a deep discount relative to fossil fuel, or when the fuel user receives a tipping fee, subsidy, or emissions credit.

 

In developing countries with little local availability of low cost fuel, waste-to-energy incineration policies can be especially attractive and effective. In Taiwan, for example, imported fuels supply more than 97% of energy consumption. Renewable energy, including waste-to-energy, provides an environmentally sound way for developing countries to decrease their dependence on expensive fossil fuel imports. Subsidies can play a vital role in increasing the usage of waste-to-energy. Industrialized counties can also play a significant role in encouraging the use of waste-to-energy. The United States, for example, has at least 630 candidate landfills and has the financial resources to effectively support the waste-to-energy industry.