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Clearly that process will take time and may be disruptive, with some collateral costs and problems on the way. However, the operational and integration problems, and system costs like those looked at above, are to some extent the result of the success of renewables: they are displacing other sources, and it will take time to adjust the system.

There are also other problems of success. For example, as renewable costs fall, it may become less attractive to invest in new capacity since profit margins may be squeezed. Indeed, in competitive market systems, there can be a ‘race to the bottom’ to the point when there is little economic incentive to continue with new projects (Holder 2018).

This so-called ‘market cannibalization’ effect can be an issue for any successful product, but it may not be a ‘showstopper’ if demand for the product is expanding, as is the case with green energy. However, the competitive ‘race to the bottom’ can still lead to problems with speculative price bids. For example, winning bids for contracts for renewables in competitive capacity auctions may sometimes be set at low power prices that the project cannot in the event deliver, so that it does not go ahead. That happened with some early renewable energy projects under the United Kingdom’s Non-Fossil Fuel Obligation competitive price/capacity auction system in the 1990s, and it may be a risk under the competitive auction systems now being used for renewables around the world (see Box 2.3).