Mitigating poverty through solar panels adoption in developing economies

Feng, Zhuo1; He, Qiao-Chu2; Ma, Guangrui3,4

2021

10.1111/deci.12505

DECISION SCI   影响因子和分区

0011-7315

1540-5915

Motivated by a widely practiced strategy to combine the growth of the solar energy sector with poverty mitigation, we propose stylized models of households selling extra solar energy back to the grid, which generates a steady stream of income to overcome adoption barriers for solar panels, that is, high adoption cost and generation variability. By considering households' strategic consumption shifting behavior in response to varying intertemporal market electricity prices, we have presented the equilibrium adoption number and households' equilibrium profit. We have also demonstrated the government's optimal subsidy to reach a socially optimal adoption level. Furthermore, we investigate the popular Public Private Partnership (PPP) model in developing countries to promote the investment of solar panels. Under the PPP program, the private firms share both upfront cost and electricity revenue with households, while the government may provide subsidy to further encourage adoption. Despite the popularity of the PPP scheme, our model documents an unexpected negative implication by inducing a lower overall adoption level than the traditional scheme: As the PPP scheme relieves budgetary burden of households in adopting solar panels (infrastructure cost), anticipating the long-term revenue loss, they are less likely to participate in the first place. However, combined with the government intervention via adoption subsidy, the PPP scheme can lead to a win-win solution for all.

developing economies poverty mitigation public private partnership subsidy solar energy

SSCI

英语

其他

Hong Kong Research Grants Council (RGC)[11215119] ; National Key Research and Development Project[2019YFD1101103] ; National Natural Science Foundation of China[71602142,71702020,71734001,72071101] ; Fundamental Research Funds for the Central Universities[DUT20RW213]

Business & Economics

Management

WOS:000612358700001

WILEY

Web of Science

1.Dalian Univ Technol, Sch Econ & Management, Dalian, Peoples R China
2.Southern Univ Sci & Technol, Fac Econ & Business Adm, Shenzhen, Peoples R China
3.Alibaba Grp, Alibaba Supply Chain Platform, Hangzhou 310099, Peoples R China
4.Shanghai Jiao Tong Univ, Antai Coll Econ & Management, Shanghai, Peoples R China

Feng, Zhuo,He, Qiao-Chu,Ma, Guangrui. Mitigating poverty through solar panels adoption in developing economies[J]. DECISION SCI,2021.

Feng, Zhuo,He, Qiao-Chu,&Ma, Guangrui.(2021).Mitigating poverty through solar panels adoption in developing economies.DECISION SCI.

Feng, Zhuo,et al."Mitigating poverty through solar panels adoption in developing economies".DECISION SCI (2021).