Solar Renewable Energy Credits (SRECs) are financial instruments created by state policies to offer incentives for generating solar energy. In an effort to support in-state solar energy sectors and boost local employment opportunities, some states have closed off their SREC markets to out-of-state solar facilities. We examine the merits of such protectionist policy from the protectionist states perspective. We find that SREC market closure leads to higher in-state SREC prices, greater solar installation, and lower electricity prices. The study illustrates the economic incentives for protecting in-state SREC markets from out-of-state solar energy producers.
This is a preprint of the article. Please cite the published version found on the journal website. Cohen, Jed J., Levan Elbakidze, Randall Jackson. 2021. “Interstate Protectionism: The Case of Solar Renewable Energy Credits." American Journal of Agricultural Economics 1-22. https://doi.org/10.1111/ ajae.12248