Economic theory would predict lower capital costs when investment risks are low and when all possible investors are encouraged to participate in a market at any time. The UK system had its deficiencies with the irregular bids, which discouraged constant involvement and small scale investments. The German feed-in law had until 2000 not encouraged utility participation. Higher investment risk from fluctuating prices can lead to higher profits for investors who take the risk. Thus, different participants in the market may prefer different regulatory regimes.
The selection of the regulatory regime will also depend on the available resource. To erect the 9000 MW of wind in Germany under a NFFO-style tender system could have required over 15,000 MW of bids to allow at least some selection in the tender process, requiring much more development effort. Competition for leases of suitable land would have increased tremendously under an auction system, as developers that speculate for high cut-off prices in the energy auction would have been able to offer higher leases, to be paid upon success of their bids.
In areas like the US Great Plains, where large suitable sites are abundant, quota systems or production incentives will be more appropriate than fixed prices, second-best only to emission taxes. Combinations of quotas and price components could combine the advantages of both in countries with intermediate resource situations like the UK.