Setting the right price for feed-in tariffs in Europe

Several EU countries such as Spain have had to make drastic cuts to subsidies to get a grip on the ballooning solar power sector. Rikki Stancich explores what pricing mechanisms could be put in place to avoid boom and bust in the sector.

Feed-in tariffs (FITs) have been very successful in Europe, leading to a massive boost in renewable energy capacity. But getting the right price can be a tricky business for policymakers. Governments have been forced to slash generous solar power subsidies over fears that the market was overheating as a result.

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