Determining the Optimal Directions of Investment in Regional Renewable Energy Development
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Date
2022
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MDPI
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Abstract
The growth of renewable energy facilities worldwide creates new challenges for sustainable
regional development. Unregulated investment flows in the green energy sector cause disparities
in the deployment of various renewable energy technologies, worsen the ability to balance national
energy systems, etc. This article is the first comprehensive study that offers a methodology for
multifactor modeling of investment flows in regional green energy deployment considering the
priorities of national, regional, and local authorities within the sustainable development concept. The
proposed methodological approaches help (1) determine the types of renewable energy technologies
for priority development in the region, (2) select specific green energy projects to receive budgetary
support on territories, and (3) form the optimal mechanism for budget financing distribution on
regional development of renewable energy technologies. The modeling factors include natural
conditions and resource base of a territory; its economically feasible renewable energy potential; the
territory’s energy needs; installed capacity and electricity generation of new green energy facilities;
power plants’ life cycle duration, the investment amount, etc. The model approbation on the example
of household solar and wind power plants in the Sumy region, Ukraine, has shown the need to
significantly increase financial support for renewable energy projects, primarily due to the region’s
energy deficit. Calculations revealed that the interest-free loan share for both technologies should
be 2.843 and 2.844 times higher than the basic share of lending (20%). For the 30-kW solar power
plant project, the indicator should be 64.67% instead of the basic one of 56.86% for home solar energy
facilities. Thus, the methodological approaches presented in the article are new tools that allow
territorial authorities to purposefully shape and manage investment flows in the renewable energy
sector to ensure sustainable energy development of regions worldwide.
Keywords
region, investment, renewable energy, optimization, preferential financing, sustainable development, household
Citation
Sotnyk, I.; Kurbatova, T.; Romaniuk, Y.; Prokopenko, O.; Gonchar, V.; Sayenko, Y.; Prause, G.; Sapiński, A. Determining the Optimal Directions of Investment in Regional Renewable Energy Development. Energies 2022, 15, 3646. https://doi.org/10.3390/en15103646