technologies Georg Zachmann, Bruegel Alexander Roth, Bruegel COP21 - - PowerPoint PPT Presentation

Countries’ comparative advantages in low-carbon technologies

Georg Zachmann, Bruegel Alexander Roth, Bruegel COP21 RIPPLES Project and Stakeholder Meeting Warsaw - April 25/26, 2018

A green industrial policy

• 2°C – target requires drastic reduction in global

emissions

• Need technologies that are (almost) competitive with

fossil fuels (otherwise incentive to deviate)

• Markets underinvest in:
• Innovation per se
• Technologies that make domestic decarbonisation cheaper
• Technologies that make foreign decarbonisation cheaper
• Resilient decarbonisation requires a portfolio of

technologies -> difficulty of choice

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Technology choice

Learning curves: specialization is necessary Choice of “right” technologies (Regional) policies to enable technology development and deployment

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Identifying potential strength

• Not all countries have potential to grow in all low-

carbon technologies

• Potential can be assed through:
• Current export specialisation
• Specialisation in related products
• Current research specialisation
• Specialisation in nearby technologies
• Regional powerhouses

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Specialization in nearby technologies

• Latent factors
• Factor cost
• Infrastructure
• Geography
• Domestic market size
• ….
• Technological links
• Similar value chain
• Tech spill-over
• Education
• …

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Mark Huberty and Georg Zachmann (2011), Green exports and the global product space: prospects for EU industrial policy

=> All informative about potential

Technological Proximity

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• Related technologies identified

by technology proximity

• Different measures/technological

networks can be used Example: Electric vehicles Power lines Motor railcars Electric power conversion (AC, DC) …

Source: Bruegel based on Patstat

Potential Strength in Technology

• Potential strength is a

combination of the

• Adjacent technologies and
• Network links

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Figure: Potential Technological Advantage in Solar Thermal

Country Example (1)

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0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00

Brazil, RTA (2008 - 2012) and pRTA

RTA: Median ± 25% of focus countries RTA (2010) pRTA pRTA: Median ± 25% of focus countries

Country Example (2)

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• 0.55
• 0.45
• 0.35
• 0.25
• 0.15
• 0.05

0.05 0.15 0.25 0.35 0.45 0.55

Brazil, change in technological strength (pRTA – RTA (2010))

Median (± 25%) of focus countries Change in Technological Strength

Conclusion

• Need for development in low-carbon techs
• Need for specialization
• Choice can be determined by many variables
• One option: strength in adjacent technologies
• Need for (regionally) targeted policies

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