How Solar Energy Became Cheap: A Model for Low-Carbon Innovation

In this Sustainable Energy Seminar, Greg Nemet, Professor of Public Affairs, will discuss the reasons behind the cost declines of solar energy and lessons that could be applied to other low-carbon technologies to accelerate innovation.


Solar energy’s path to widespread adoption provides a successful model that can be applied to other technologies we will need to address climate change. Solar photovoltaics (PV) has become a substantial global industry—a truly disruptive technology that has generated trade disputes among superpowers, threatened the solvency of large energy companies, and prompted serious reconsideration of electric utility regulation rooted in the 1930s.  But,

How did solar become inexpensive?  And why did it take so long?

As a 2017 Andrew Carnegie Fellow I have had the opportunity to dive deeply into these questions, drawing on new data sets, analyses, and interviewing over 60 individuals in more than a dozen countries.  The concept of National Innovation Systems provides a theoretical structure for this assessment and helps explain that PV’s success has been the result of distinct contributions mainly by the US, Japan, Germany, and China—in that sequence.  Flows of knowledge from one country to another—often embodied in equipment, and also as tacit knowledge in the heads of internationally mobile individuals—have been central to solar’s progress.  One payoff from understanding the reasons for solar’s success is that it can serve as a model for other low-carbon technologies.  However other technologies would have to progress much faster than PV to be helpful for climate change.  Possible approaches for accelerating innovation include: dynamic R&D foci, codification of knowledge, public procurement, robust markets, enhancing knowledge mobility, and addressing political economy considerations.

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