Determinants of investments in solar photovoltaic: Do oil prices really matter?

Margaux Escoffier (1) , Emmanuel Hache (1) , Valérie Mignon (1) , Anthony Paris (1)

1 EconomiX - EconomiX

This paper investigates the determinants of solar photovoltaic (PV) deployment in the electricity mix for a panel of OECD and BRICS countries from 1997 to 2016 by paying particular attention to the impact of oil market conditions. Relying on a nonlinear, regime-switching specification, we show that rising oil prices stimulate PV deployment only if their growth rate is important, above 6.7%. Although we find that various other determinants matter—with the influence of some of them depending on the situation on the oil market—public policies play a crucial role. In particular, our findings show that feed-in-tariffs should be encouraged to ensure a continuous fight against climate change, whatever the dynamics followed by oil prices.

Mots clés: Solar photovoltaic; Renewables deployment; Oil prices; Panel smooth transition regression

Domaines: Economies et finances

Margaux Escoffier, Emmanuel Hache, Valérie Mignon, Anthony Paris. Determinants of investments in solar photovoltaic: Do oil prices really matter?. 2019. ⟨hal-04141866⟩