Question

1a) What is the difference between renewable and nonrenewable energy?

1b) Do current price signals suggest that non-renewable resources are close to depletion?

1c) How can taxes be used to promote renewable energy? What non-tax policies can be used to promote renewable energy?

Answer 1

1a)Renewable energy:

*It is obtained from resources which can be renewed or replenished easily.

*It can be used again and again

*Eco friendly as it emits very less carbon

*It is available in unlimited quantities.

*Example:

Solar energy, tidal energy, wind energy

Non renewable energy :

*It is obtained from resources which cannot be renewed or replenished easily.

*It is quickly exhaustible.

*Carbon emissions is very high, which leads to environmental problems like green house effect.

*Available in limited quantities.

*Example -

Energy from coal, petroleum, natural gas.. etc

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1b).Current prices for non renewable resources are very high. It indicates that the non renewable energy resources are at the verge of depletion. Higher prices are maintained in order to reduce the imbalances between production and consumption.,

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1c)Taxes for Renewable Energy is introduced to support energy companies, investors and other entities stay current with government policies and programs that support renewable energy from wind, solar, biomass, geothermal and hydropower. It takes different form in different countries. Some of the examples of tax policies for the promotion of renewable energy are pollution tax, carbon tax and tax exceptions. With pollution tax and carbon tax people limit the dependance on non renewable energy resources which creates environmental issues. With tax exemption on using renewable energy resources, people prefer to use or depend on renewable resources again and again.

Some non-tax policies can be used to promote renewable energy resources are as follows :,

1.Provision of loans at low interest rates for the purchase and installation of renewable energy equipments.

2.Laws to install solar panels and biogas plants for the new houses.

3.Allowances for renewable energy generation

4.Allowances and grants for the Research and development of renewable energy resources.

5.Declaration of Carbon free zones.