Which Subsidy Mode Improves the Financial Performance of Renewable Energy Firms? A Panel Data Analysis of Wind and Solar Energy Companies between 2009 and 2014

Sustainability

Huiming Zhang¹  Yu Zheng⁴  Dequn Zhou⁵  Peifeng Zhu³  Yongrok Choi²  Malin Song² 

[1] China Institute of Manufacturing Development & College of Economics and Management, Nanjing University of Information Science & Technology, Nanjing 210044, China;id="af1-sustainability-07-15831">1China Institute of Manufacturing Development & College of Economics and Management, Nanjing University of Information Science & Technology, Nanjing 210044, ChiCollege of Economics and Management, Nanjing University of Chinese Medicine, Nanjing 210023, China;College of Economics and Management, Nanjing University of Information Science&Technology, Nanjing 210044, China;Research Centre for Soft Energy Sciences, Nanjing University of Aeronautics and Astronautics, Nanjing 211100, China;

关键词: renewable energy;    subsidy mode;    financial performance;    panel data model;   

DOI  :  10.3390/su71215831

来源: mdpi

【 摘 要 】

The effectiveness of subsidies in improving the performance of renewable energy firms has aroused significant research attention in recent years. As subsidy modes may affect corporate financial performance,we have chosen companies specializing in wind and solar energy in the Shanghai and Shenzhen stock markets as samples.The relationships between the subsidy modes and financial performance of these two types of companies are investigated with a panel data model. Results of the total sample indicate that both indirect and non-innovative subsidy have significant effects on the financial performance of renewable energy companies. The regressive coefficient of the former,however, is a negative value, which illustrates that taxation, bonus, and other market-based mechanisms impair corporate profitability. Moreover, the influence of innovative subsidy is weak, which means that the subsidy used for research and development, technical demonstration, and other innovations of renewable energy enterprises have failed to effectively enhance corporate financial performance. In terms of sub-industries, the direct subsidy for wind energy companies has achieved a significant effect. Incomparison, the indirect subsidy and innovative subsidy acquired by solar energy companies have notably reduced corporate profitability. Thissuggests an urgent reform of subsidy policy for this industry is needed. The government should consider differences in the effects subsidies have for wind and solar energy companies when improving subsidy policy. In addition, market-based subsidy mechanisms should be perfected, and the structure of innovative subsidies should be ameliorated.

【 授权许可】

CC BY   
© 2015 by the authors; licensee MDPI, Basel, Switzerland.