Model for development of energy technologies in technology-follower countries

Abstract

In this study, a comprehensive analytical tool for assessment of energy technologies and R&D resource allocation is developed taking into account the specific conditions of technology follower countries. The analytical instrument includes two interlinked models: technology assessment and optimal R&D resource allocation. Energy technology assessment and prioritization of new energy technologies are provided by a dynamic systems engineering optimization model of energy supply system. Then based on the economic and environmental impacts of technologies, optimal allocation of R&D resources for new technologies is estimated with the help of the R&D resource allocation model. This model is formulated as an optimal control problem and it considers the R&D activities and knowledge stock as the main control and state variables. This model maximizes the total net present value of resulting R&D benefits taking into account the dynamics of technological progress, knowledge and experience spillovers from advanced regions, technology adoption and R&D constraints. In this model, the role of degree of spillover, follower country’s innovation capacity, knowledge complexity and absorption capacity is highlighted in the modeling of knowledge accumulation in follower countries. In this paper the mathematical formulation of the R&D resource allocation model and its linkage with the energy supply model will be described. Thereafter, the application of the interlinked models will be explained through a test case and the applicability of the energy R&D resource allocation model and its contribution to the profession of energy modeling will be concluded.