Pitfalls of Policy Implementation: The Case of the South African Feed-In Tariff
DIFFUSION OF RENEWABLE ENERGY ENERGY TECHNOLOGIES: CASE STUDIES OF ENABLING FRAMEWORKS IN DEVELOPING COUNTRIES, pp. 101-110, James Haselip, ed., UNEP Risoe Centre, 2011
Posted: 24 Mar 2012
Date Written: 2011
The carbon intensity of the South African economy is among the highest in the world: the amount of CO2 emitted per million international dollars generated reaches almost twice the world average. The first steps have been taken by the South African government to tackle the challenge of decarbonization, such as the introduction of a renewable energy feed-in tariff (REFIT) in 2009. However, REFIT is a showcase for potential pitfalls in the implementation of renewable energy support policies: a stalemate lasting two years after the introduction of REFIT ended with the abandonment of the scheme in favor of a competitive bidding process in 2011. This paper seeks to analyze the underlying reasons for this and to offer recommendations for similar situations in the future.
The paper identifies three main barriers to the implementation of REFIT: 1) social priorities other than the deployment of renewable energy technologies, 2) a lack of coordination and capacity at the policymaking level, and 3) strong lobby groups with interests in fossil fuel technologies. These barriers not only exist in South Africa, but in most other developing countries. Therefore, many of the recommendations for South Africa can be transferred to other country contexts, such as: informing the public about climate change and stressing the positive side-effects of renewable energy technologies, thereby building public support, making use of international mechanisms to build political momentum, forming clean-energy coalitions with powerful groups in society, communicating support rules as early and clearly as possible, and keeping later adjustments to the rules predictable to maintain investment certainty, establishing inter-ministerial groups with oversight authority to enhance political coordination, supporting established energy suppliers in their discovery of renewable energy tariffs (RETs) as a new business field, strengthening the position and capacity of renewable energy newcomers.
Keywords: renewable energy, feed-in tariffs, South Africa, climate policy
JEL Classification: Q42, Q48, O14, O38
Suggested Citation: Suggested Citation