Feed-In Tariff

A A A

DEFINITION

An economic policy created to promote active investment in and production of renewable energy sources. Feed-in tariffs typically make use of long-term agreements and pricing tied to costs of production for renewable energy producers. By offering long-term contracts and guaranteed pricing, producers are sheltered from some of the inherent risks in renewable energy production, thus allowing for more diversity in energy technologies.

INVESTOPEDIA EXPLAINS

The first feed-in tariff was implemented by the Carter administration in the United States in the late 1970s. The National Energy Act as it was known was meant to promote energy conservation along with the development of new renewable sources of energy, such as solar and wind power. Since this time, feed-in tariffs have been widely used throughout the world, most notable in Germany, Spain and other parts of Europe.


RELATED TERMS
  1. Tariff

    A tax imposed on imported goods and services. Tariffs are used to restrict trade, ...
  2. Detariffing

    The act of removing the pricing regulations of an industry, set forth by tariffs ...
  3. Export

    A function of international trade whereby goods produced in one country are ...
  4. Quota

    A government-imposed trade restriction that limits the number, or in certain ...
  5. Protectionism

    Government actions and policies that restrict or restrain international trade, ...
  6. LIBOR

    LIBOR or ICE LIBOR (previously BBA LIBOR) is a benchmark rate that some of the ...
  7. Global Recession

    An extended period of economic decline around the world. The International Monetary ...
  8. Economic Exposure

    A type of foreign exchange exposure caused by the effect of unexpected currency ...
  9. Heckscher-Ohlin Model

    An economic theory that states that countries export what they can most easily ...
  10. North American Free Trade Agreement ...

    A regulation implemented on Jan. 1, 1994, that decreased and eventually eliminated ...
Related Articles
  1. The Uncertainty Of Economics: Exploring ...
    Economics

    The Uncertainty Of Economics: Exploring ...

  2. The History Of Economic Thought
    Economics

    The History Of Economic Thought

  3. Explaining The World Through Macroeconomic ...
    Options & Futures

    Explaining The World Through Macroeconomic ...

  4. The Taylor Rule: An Economic Model For ...
    Economics

    The Taylor Rule: An Economic Model For ...

  5. Russian Interests
    Investing

    Russian Interests

  6. America The Youthful? Yes, On a Relative ...
    Investing

    America The Youthful? Yes, On a Relative ...

  7. Thoughts From The Frontline: Every Central ...
    Economics

    Thoughts From The Frontline: Every Central ...

  8. Sanctions Between Countries Pack a Bigger ...
    Economics

    Sanctions Between Countries Pack a Bigger ...

  9. Financialization
    Markets

    Financialization

  10. The Austrian School Of Economics
    Economics

    The Austrian School Of Economics

comments powered by Disqus
Hot Definitions
  1. Cash and Carry Transaction

    A type of transaction in the futures market in which the cash or spot price of a commodity is below the futures contract price. Cash and carry transactions are considered arbitrage transactions.
  2. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  3. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  4. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  6. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
Trading Center