**7.2 Financial instruments and support**

A number of public or private funding instruments are currently in operation in European countries to promote renewable energy and energy storage itself. The choice of instruments depends on the point at which technology or projects are created. The bulk of funding instruments come into three primary categories:


The criterion used to test the funding systems, the financial instruments, and the support are as follows:

Efficiency-applies, on the one hand, to extra generation costs and, on the other, to regulation costs. Although the additional generation costs reflect the welfare effects in general, the policy costs additionally consider the distributional effects or the issue of which stakeholder pays for the additional costs.

Effectiveness- analyzes the effect of funding systems on the business diffusion of clean energy technology.

Certainty for investors-the degree to which policy instruments are capable of minimizing the uncertainties of energy and renewable energy ventures, which could be of a fiscal, technical, or political type.

Long-term competitiveness.

Market compatibility (only applicable to help schemes, not applicable) [61].
