Panel Paper: Technology Spillovers in Solar Photovoltaics: How Much Did They Matter and How Did They Happen

Thursday, November 6, 2014 : 1:00 PM
Apache (Convention Center)

*Names in bold indicate Presenter

Laura Diaz Anadon, Harvard University and Christoph Wuestemeyer, Massachusetts Institute of Technology
Virtually all studies agree that innovation in energy technologies will be necessary to meet the world’s energy challenges. The question that interests policy makers and scholars alike is what governments can do to accelerate innovation in energy technologies, given that we know that innovation is a complex process that involves transforming an idea to a technology diffused widely in the market place.

This study addresses the importance of cross-sectoral technology spillovers in the cost reductions of two orders of magnitude that solar photovoltaic (PV) systems have experienced over the past 40 years and identify what made them possible.  To date, no study has systematically evaluated the extent to which technology spillovers from other sectors have contributed to cost reductions over time in a particular technology. Instead, the literature on spillovers has largely focused on either inferring the effects of R&D done in some countries (or firms) on the productivity of other countries (or firms) through indirect measures like foreign direct investment or identifying the existence (but not the impact) of spillovers through patent citations. The policy relevance of this question is that it can help us identify whether spillovers had a significant impact, and government policies complementary to direct funding for specific technologies and general funding for basic research. This paper will present the results of the following analysis: 

(1) Identification of major technology breakthroughs affecting solar PV technology

We have identified 34 major discoveries contributing to solar PV cost reductions through a combination of literature review and interviews.

(2) Identification of breakthroughs originating outside of the solar PV sector

Using company history documents, patents, patent citations, scientific papers, and interviews with industry pioneers, we have determined which of the 34 breakthroughs came from research conducted with the purpose of developing better solar PV systems and which originated elsewhere. Initial work suggests that at least 7 of them—most prominently screen printing and wire sawing—came from other sectors.

(3) Quantification of the impact of the spillovers on solar PV cost reductions

We have estimated the total impact that these spillovers had using a very detailed engineering cost model. Early calculations suggest that the impact of these cross-sectoral spillover breakthroughs could account for 15-25% of the total cost reductions, already indicating the importance of considering spillovers in efforts to promote innovation.

(4) Identification of the enablers of the spillovers and framework development

Using the resources described in step 2, we are developing a detailed micro-history of the spillover breakthroughs. Based on these micro-histories, we are developing a framework to categorize the roles that government policy has played enabling them, e.g., workforce development, network creation, direct R&D funding, public procurement, normative power.

This case-study based approach will not allow extrapolation of findings to very different technology areas, but it will call attention to the important contribution of technology spillovers to the evolution of a promising energy technology and also enable the development of a framework to better understand complementary government policies to direct R&D funding.