Competitive advantage of German renewable energy firms in India and China

Abstract

PurposeThe purpose of this paper is to analyze the competitive advantage of German renewable energy firms in India and China. Porter's diamond model is modified and specified for the renewable energy industry.Design/methodology/approachBased on Porter's diamond model of competitiveness, the authors examine the demand for renewable energies in India and China and the ability of German firms to meet this demand.FindingsWhile the overall demand for renewable energies in India and China is significant, the study reveals remarkable differences in the fields of biomass, solar and wind energy. The findings are meant to address managers in the renewable energy industry and to aid policy makers in environmental support and action.Research limitations/implicationsA major theoretical contribution of the study is the application of Porter's diamond model to the renewable energy industry, as well as the identification and operationalization of the relevant causal and proxy variables.Practical implicationsThe paper provides a detailed analysis of the factors on which the competitive advantage of German renewable energy technologies in India and China is based. This helps managers of renewable energy firms to focus on those areas where they have particular strengths and to introduce measures to overcome potential weaknesses.Originality/valueThe authors used a modified version of Porter's diamond model and specified it for the renewable energy industry. The model was tested empirically in Germany and both emerging countries on the basis of secondary data.