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Title: Non-Monotonic Effects of Market Concentration on Prices for Residential Solar Photovoltaics in the United States

Abstract

Emerging renewable energy markets may become more concentrated over time as the most efficient firms accumulate market share. The effects of this market concentration on prices are tested using a rich dataset of residential solar photovoltaic (PV) systems in the United States. A novel hypothesis is explored that the effects of market concentration may be non-monotonic. Prices may decline in market concentration due to efficiency gains associated with returns to scale but increase in concentration in already concentrated markets due to increasing market power. The results of an econometric model provide evidence to support the non-monotonic hypothesis. However, the data suggest that the relationship between prices and firm scale is nuanced, and that both large- and small-scale PV installers may wield efficiency advantages.

Authors:
 [1]
  1. National Renewable Energy Laboratory (NREL), Golden, CO (United States)
Publication Date:
Research Org.:
National Renewable Energy Lab. (NREL), Golden, CO (United States)
Sponsoring Org.:
USDOE Office of Energy Efficiency and Renewable Energy (EERE), Solar Energy Technologies Office (EE-4S)
OSTI Identifier:
1484341
Report Number(s):
NREL/JA-6A20-72645
DOE Contract Number:  
AC36-08GO28308
Resource Type:
Journal Article
Resource Relation:
Journal Name: Energy Economics; Journal Volume: 78
Country of Publication:
United States
Language:
English
Subject:
14 SOLAR ENERGY; 29 ENERGY PLANNING, POLICY, AND ECONOMY; market concentration; solar competition; market power

Citation Formats

OShaughnessy, Eric J. Non-Monotonic Effects of Market Concentration on Prices for Residential Solar Photovoltaics in the United States. United States: N. p., 2018. Web. doi:10.1016/j.eneco.2018.11.010.
OShaughnessy, Eric J. Non-Monotonic Effects of Market Concentration on Prices for Residential Solar Photovoltaics in the United States. United States. doi:10.1016/j.eneco.2018.11.010.
OShaughnessy, Eric J. Wed . "Non-Monotonic Effects of Market Concentration on Prices for Residential Solar Photovoltaics in the United States". United States. doi:10.1016/j.eneco.2018.11.010.
@article{osti_1484341,
title = {Non-Monotonic Effects of Market Concentration on Prices for Residential Solar Photovoltaics in the United States},
author = {OShaughnessy, Eric J},
abstractNote = {Emerging renewable energy markets may become more concentrated over time as the most efficient firms accumulate market share. The effects of this market concentration on prices are tested using a rich dataset of residential solar photovoltaic (PV) systems in the United States. A novel hypothesis is explored that the effects of market concentration may be non-monotonic. Prices may decline in market concentration due to efficiency gains associated with returns to scale but increase in concentration in already concentrated markets due to increasing market power. The results of an econometric model provide evidence to support the non-monotonic hypothesis. However, the data suggest that the relationship between prices and firm scale is nuanced, and that both large- and small-scale PV installers may wield efficiency advantages.},
doi = {10.1016/j.eneco.2018.11.010},
journal = {Energy Economics},
number = ,
volume = 78,
place = {United States},
year = {Wed Nov 14 00:00:00 EST 2018},
month = {Wed Nov 14 00:00:00 EST 2018}
}