The effect of heterogeneous national technological capabilities on a Net-zero energy system

Abstract

Numerous studies have linked the heterogeneous nature of national technological capabilities to the disparities in country-level low-carbon investment patterns. This study investigates how differences in national and regional technological capabilities can impact the pathway to a global net-zero energy system using an integrated assessment modeling approach. The study begins by developing a novel metric that captures the heterogeneity of national low-carbon technological endowments. The metric is then modeled to explore the regional and global low-carbon investment and CO2 abatement trends. Modeling results reveal that the heterogeneity of low-carbon technological competencies induces an asymmetry in low-carbon investments across countries and regions. This asymmetry is driven by a low-carbon investment gap created by developing economies with inferior technological capabilities. Conversely, frontier low-carbon technology regions increase their technology deployment efforts to compensate for the investment deficits. The resultant impact of the asymmetry leads to a moderate but non-trivial increase (i.e., 5.1 to 9.3 %) in the policy cost for achieving the net-zero energy target. Insights gleaned from this computational thought experiment reassert the importance of supporting local technological capabilities in the context of global climate mitigation.