Existing research in renewable energy transitions largely seeks to identify success factors needed to improve planning, formulate policy transfer options and enhance the social acceptance of renewable energy, yet lacks in context specificity and assumes static institutional settings. In this paper, we explore institutional factors that promote or hinder energy transitions, employing an institutionalist approach to connect changes in formal and informal institutions at state, regional and local levels. In doing so we intend to create an understanding of the impact of specific institutional constellations that set the framework for defining social acceptance. The analysis of the diffusion of photovoltaic systems in two municipalities in Germany and Australia points to the different energy paths taken by the two countries. By contrasting two differing energy systems, we are able to deduce the evolution of institutional settings (market-based or government-funded mechanisms) that help explain social acceptance. Furthermore, the findings of the multi-level approach offer insight into how changes can have an impact locally but also how the local setting is affected by national policies and market dynamics.