Addressing key issues in technology innovation and transfer of clean energy technologies: a focus on enhancing the enabling environment in the developing countries

Abstract

This paper addresses key issues to consider in designing international policies and institutions to encourage technology innovation and transfer of clean energy technologies. The first part of the paper presents a conceptual framework so-called Research & Development, Demonstration, Deployment, Diffusion, and Commercial maturity, “RDD&D chain”. The RDD&D chain indicates that there are several stages in technological development. The paper recognizes that different policy measures need to be designed for each stage of technological development. At the diffusion stage of technological development, the paper argues that while it is important to provide the private sector with economic incentives through economic policy instruments such as clean development mechanism, it is not enough for clean energy technologies to be successfully installed in the developing countries. It points out that there is a strong need for institutional support for accessing information on technologies and enhancing local capacity to handle such technologies at the diffusion stage. The second part of the paper describes barriers that hamper innovation and transfer of technologies in the developing countries. The paper highlights a lack of the enabling environment in the developing countries as a main barrier in transferring technologies at the diffusion stage. It emphasizes that the institutional support for improving the enabling environment and enhancing capacity of the developing countries is also essential for successful innovation and transfer of technologies at this stage.