We examine the impact of the interest rate and its characteristics, such as long run mean and instantaneous variance risk (VR), on renewable energy investments in the power sector. The model has stochastic electricity price, stochastic interest rate, and variance regime switches. We show that an increase in the interest rate, while generally increasing the value of a power project, can have a non-monotone effect if the subsidy is sufficiently large. VR increases (reduces) the project value in the high variance regime, if the subsidy is sufficiently large (low). Under a fixed price contract, value declines and it is optimal to delay investment following an increase in the interest rate. The model helps to explain the US offshore industry experience in 2023.

中文翻译：

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具有政权转换波动性的随机利率下的可再生能源投资


我们研究了利率及其特征（例如长期均值风险和瞬时方差风险 (VR)）对电力行业可再生能源投资的影响。该模型具有随机电价、随机利率和方差机制切换。我们表明，利率上升虽然通常会增加电力项目的价值，但如果补贴足够大，则可能会产生非单调效应。如果补贴足够大（低），VR 会增加（减少）高方差情况下的项目价值。在固定价格合同下，价值下降，最好在利率上升后推迟投资。该模型有助于解释2023年美国离岸行业的经验。