Sectoral Transformation in the Photovoltaics Industry in Australia, Germany and Japan: Contrasting the Co‐evolution of Actors, Knowledge, Institutions and Markets¹

1. The authors acknowledge the financial support of the Australian Innovation Systems (AUSIS) Project, Australian Research Council (ARC), Australian Commonwealth Scientific and Industrial Research Organisation (CSIRO), Australian Department of Agriculture, Fisheries and Forestry (AFFA), Department of Industry, Tourism and Resources (DITR), and ABF.

Abstract

This paper studies the evolution of the photovoltaics industry in Australia, Germany and Japan taking a comparative perspective. A modification of the sectoral innovation system framework is used to discuss: knowledge and technologies, actors and interactions, institutions and funding, development of markets and technological structure, as a way to understand the changes. In the process of transition from niche to mass production, national players have specialised in different activities, and the institutions’ building block has been a key determinant. In the case of Australia, it is also the least developed area which ultimately exposes the country to losing its innovation benefits.

Keywords:

• innovation
• sectoral innovation systems
• renewables
• energy sector

Notes

1. The authors acknowledge the financial support of the Australian Innovation Systems (AUSIS) Project, Australian Research Council (ARC), Australian Commonwealth Scientific and Industrial Research Organisation (CSIRO), Australian Department of Agriculture, Fisheries and Forestry (AFFA), Department of Industry, Tourism and Resources (DITR), and ABF.

2. F. Malerba, ‘Sectoral systems of innovation: a framework for linking innovation to the knowledge base, structure and dynamics of sectors’, Economics of Innovation and New Technology, 14, 1/2, 2005, pp. 63–82.

3. Christopher Freeman, Technology and Economic Progress: Lessons from Japan, Pinter, London, 1987; Bengt‐Åke Lundvall (ed.), National Systems of Innovation: Towards a Theory of Innovation and Interactive Learning, Pinter Publishers, London, 1992; Richard Nelson, National Innovation Systems: A Comparative Analysis, Oxford University Press, Oxford, 1993.

4. Malerba, op. cit.; F. Malerba, ‘Sectoral systems of innovation and production’, Research Policy, 31, 2, 2002, pp. 247–64.

5. S. Jacobsson and V. Lauber, ‘The politics and policy of energy system transformation‐explaining the German diffusion of renewable energy technology’, Energy Policy, 34, 3, 2006, pp. 256–76.

6. B. Andersen, J. S. Metcalfe and B. S. Tether, ‘Distributed innovation systems and instituted economic processes’, in J. S. Metcalfe and I. Miles (eds), Innovation Systems in the Service Economy: Measurement and Case Study Analysis, Kluwer, Dordrecht, 2000.

7. Bruce Tether and Stan Metcalfe, Innovation Systems and Services: Investigating ‘Systems of Innovation’ in the Services Sectors‐An Overview, Working Paper ESSY, 2001.

8. Andersen et al., op. cit.

9. The term new renewable industry usually excludes hydropower and biomass as sources of energy.

10. Greg Watt and Muriel Watt, Photovoltaics in Australia. A Report Commissioned by the Energy Research and Development Corporation (ERDC), Canberra, Australia, 1994.

11. Muriel Watt, The Commercialisation of Photovoltaics Research in Australia. A Report for Science and Innovation Mapping, Department of Education Science and Training, Canberra, Australia, 2003.

12. Australia’s share is now around 2%. See M. Twidell, Case study: identifying regional markets for Australian renewable expertise, 2nd Annual Renewable Energy Conference, Sydney, 2003.

13. Ibid.

14. NERDDC is the National Energy Research Development and Demonstration Council, established in 1978, and SERDF is the NSW Sustainable Energy Research and Development Fund.

15. Twidell, op. cit.

16. S. Jacobsson and A. Johnson, ‘The diffusion of renewable energy: an analytical framework for research’, Energy Policy, 28, 9, 2000, pp. 625–40.

17. For example, this may explain the interest of Origin Energy in the Australian National University’s research on photovoltaics and sustainable energy systems.

18. Jacobbson and Johnson, op. cit.

19. S. Jacobsson and A. Bergek, ‘Transforming the energy sector: the evolution of technological systems in renewable energy technology’, Industrial and Corporate Change, 13, 5, 2004, pp. 815–49.

20. Chris Freeman and Francisco Louca, As Time Goes By: From the Industrial Revolutions to the Information Revolution, Oxford University Press, Oxford, 2002.

21. Business Council for Sustainable Energy, media release January 2004, available at: http://www.bcse.org/whatsnew.htm, accessed 18 May 2006.

22. Watt, op. cit.

23. W. B. Erickson and I. Maitland, ‘Healthy industries and public policy’, in M. E. Dewar (ed.), Industry Vitalization: Toward a National Industrial Policy, Pergamon Press, New York, 1982.

24. T. Breshanan, A. Gambardella and A.‐L. Saxenian, ‘Old economy inputs for new economy outcomes: cluster formation in the new Silicon Valleys’, Industrial and Corporate Change, 10, 4, 2001, pp. 835–60.

25. M. Konagai, Thin Film Solar Cells Program in Japan: Achievements and Challenges‐National Renewable Energy Laboratory, National Center for Photovoltaics, US, 2002, available at: http://www.nrel.gov/ncpv_prm/pdfs/papers/18.pdf, accessed 18 May 2006.

26. K. Shino and O. Ikki, National Survey of PV Power Applications in Japan 2002, International Energy Agency, Cooperative Program on Photovoltaics Power System, 2003.

27. Ibid.

28. Jacobsson and Bergek, op. cit.

29. Arnulf Jäger‐Waldau, Research, Solar Cell Production and Market Implementation in Japan, USA and the European Union, PV Status Report 2003, Institute for the Environment and Sustainability, European Commission, Renewable Energies Unit, Italy, 2003.

30. The term technological structure is somewhat arbitrarily chosen. It basically captures the same issues that Malerba, 2002, op. cit. denoted as basic technologies, inputs and demand with key links and dynamic complementarities.