The dynamics of renewable energy transition in developing countries - The case of South Africa and India

The innovation dynamics in the transition to renewable energy industries in India and South Africa is explored, by examining the development of the two main renewable energy technologies and comparing the transitional approaches. The functions of a technological systems approach is used to trace the evolution of actors, networks and institutions that have had a bearing on the generation and diffusion of renewable energy technologies in these countries. Through this analysis we improve our understanding of the processes or functions involved in the formation and uptake of renewable energy systems in developing countries and identify the associated key challenges for policy makers managing the transformation process. Current technological and innovation systems approach analysing the evolution of renewable energy systems ignores renewable energy industrial evolution in developing countries. We argue that developing countries have different learning stages of industrial development and different learning strategies, which need to be considered when evaluating renewable energy innovation systems, which has remained neglected in existing studies. Functions that induce the transition are found to be weak in South Africa as compared to India. India compares fairly well in terms of development of positive externalities, degree of legitimation and entrepreneurial activities. However, the availability and effect of the inducement instruments in each country varies from one renewable energy technology to another. Wind and solar energy technologies are explored and their transitions compared.

Keywords: renewable energy, technological innovation systems, low-carbon transitions

JEL Classification: Q42, Q01, O33