International Diffusion of Renewable Energy Innovations: Lessons from the Lead Markets for Wind Power in China, Germany and USA

• Main Authors: Juliana Subtil Lacerda, Jeroen C. J. M. van den Bergh
• Format: Article
• Language: English
• Published: MDPI AG 2014-12-01
• Series: Energies
• Subjects: climate change; competitiveness; renewable energy; policy support
• Online Access: http://www.mdpi.com/1996-1073/7/12/8236

The international diffusion of environmental innovations is getting increasing attention as an opportunity to improve competitiveness. Especially in the energy sector, countries use policy support to this end. A recent goal in this context is the formation of “lead markets”, which represents the idea that countries can build up first-mover advantages that will increase their competitiveness. Taking the lead in international diffusion of a particular innovation benefits a country’s industry through creating increasing returns of technological development and stimulating exports to expanding international markets. Interaction between national and international forces affecting renewable energy innovation and its diffusion has received fairly little attention so far. Here, we investigate the formation of lead markets for wind power technologies in China, Germany and the USA to see whether policy support of renewable energy innovation is capable of improving competitiveness. An extension of the current lead market framework is developed to include supply side factors and technology policy issues. The comparative analysis of lead market potential for wind power indicates a high level of internationalization of the industry with countries holding lead positions in specific parts the supply chain. Competitive advantages were built upon policy support but tended to shift among countries.