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I N C LU S I V E G R E E N G R O W T H: T H E PAT H WAY TO S U S TA I N A B L E D E V E LO PM E N T

FIGURE 3.5 Snapshot of technology creation and diffusion Stimulate market pull voluntary (green) demand

Technology-neutral competition TGC carbon trading (EU, ETS)

market deployment

74

Mature technologies (e.g., hydro)

Low cost-gap technologies (e.g. wind onshore) Imposed market risk, guaranteed but declining market return

Continuity, RD&D, create market attractiveness capital cost-incentives, investment tax credits, rebates, loan guarantees etc

Prototype & demonstration stage technologies (e.g., 2nd generation biofuels)

Development

High cost-gap technologies (e.g., PV)

Niche markets

Stability, low-risk incentives price-based: FIT, FIP quantity bassed : tenders

Mass market

Time

Source: IEA 2008 (Deploying Renewables: Principles for Effective Policies © OECD/International Energy Agency 2008, figure 1, page 25). Note: FIT= feed-in tariffs; FIP = feed-in premiums; PV = photovoltaic; RD&D = research, development, and demonstration; TGC = tradable green certificate.

innovative role models (such as India’s Tata Group’s awarding of an annual prize for the best failed idea) and reducing the sunk costs of trying to commercialize an idea, such as removing impediments to deeper rental and resale markets. • Policies to facilitate global connectivity and learning. Here the emphasis should be on linking up with international consortia and helping firms insert into global value chains. International mobility of workers was critical to the rapid development of wind energy capabilities in China and India. Suzlon, the leading Indian wind turbine manufacturer, established R&D facilities in Germany and the Netherlands to have its workers learn from European expertise. Goldwind, the leading Chinese manufacturer, sent employees abroad for training. 4

Learning networks were also critical in the development of China’s PV panel industry. 5 Mexico’s Green Supply Chains Program—a public-private partnership program—highlights a way to diffuse eco-effi ciency techniques to small- and medium-size enterprises.6 • Policies to increase the livability and “stickiness” of cities to attract and retain talent. Dense urban-industrial agglomerations spur technological upgrading and productivity growth by opening up opportunities and stimulating supplies of capital and skills. China’s establishment of special economic zones, followed by a range of support by national and local governments for further industrial deepening in its three major urban/ industrial agglomerations and in a number of inland cities, highlights how

Inclusive Green Growth  
Inclusive Green Growth  

As the global population heads toward 9 billion by 2050, decisions made today will lock countries into growth patterns that may or may not b...