How Could the Government Support the Spread of Alternative Energy Projects?

Publication Name: World Sustainability Series

Publication Date: 2026-01-01

Volume: Part F1269

Issue: Unknown

Page Range: 145-169

Description:

The study examines the changes in the simple investment payback period of three alternative energy projects like a solar PV (photovoltaic), a wood chip-fired boiler and a heat pump system in the face of changing energy prices, interest rates, investment cost and inflation. The purpose of this paper is not to compare the three projects, but to show how the returns of alternative energy projects have changed as a result of the effects apparent in Hungary. Considering the fact, that it is based on real-life projects and an energy-conscious calculation, the article focuses on practical feasibility in order to ensure adaptability. The central focus of this study is to demonstrate how the return can change dramatically over a 3–4-year time horizon from the perspective of investors, thus highlighting the economic rationality of postponement decisions. The government can lower risk by supporting renewable energy projects with financial incentives, running suitable financial systems, and providing resources for them, according to this study. Predetermined feed-in tariffs, green pricing for "green electricity," capital subsidies, grants, or refunds, low-interest loans, or carbon credits are a few examples of financial incentives. Enhancing investor confidence and legally protecting stakeholders' interests and returns are critical expectations. In conclusion, by guaranteeing investors long-term profits, the government plays a critical role in the growth of alternative energy initiatives.

Open Access: Yes

DOI: 10.1007/978-3-032-07224-5_8

Authors - 2