The results of the GRETCHEN project show that rapid technological progress in renewable power generation technologies has taken place in Germany over the last few decades. This is indicated by the strong increase in scientific publications in photovoltaics, or the rise in the number of patent applications in wind power and photovoltaics. As a result, the majority of German manufacturers of renewable energy technologies were able to develop new export markets which in turn had a positive effect on macroeconomic development and employment. However, the innovation dynamics are currently showing signs of slowing down in Germany. In addition, fast-paced technology catch-up is taking place in Asian countries, in particular. The project team’s analyses make it clear that technology-push, demand-pull and systemic instruments each have a clear impact on green change in the technologies regarded. Examining the policy mix as a whole additionally shows that the various instruments mutually reinforce each other’s positive influence on innovation. The GRETCHEN analyses indicate the central role played by demand-pull measures in the instrument mix. Depending on technology specific learning potentials, the resulting positive impacts on green innovation can trigger a self-reinforcing process of cost reduction and expansion of renewable energies that helps to overcome current path dependencies in the energy system. GRETCHEN also found a high relevance of the credibility of political support as a driver of innovation in green electricity generation technologies:
The currently worsening innovation climate for renewable energies is a warning to policy makers. Technological change has been steered in the right direction and now has to be encouraged rather than decelerated, given its many benefits and the ambitious energy and climate targets. Three main policy recommendations can be derived from the GRETCHEN analyses:
- To successfully steer technological change in the energy system, it is essential to have a carefully coordinated combination of different policy instruments. The policy mix has to be understood and designed as a whole - backing only one instrument will not achieve the desired result.
- In order to stimulate dynamic innovative activity, this policy mix has to be credible and internally consistent to the greatest possible extent. Without a strong political will for green change, there is uncertainty about future market developments which hinders long-term investments in innovation and threatens Germany’s technological competitiveness in the analysed technologies.
- The shift towards renewable power generation technologies is an increasingly global process that will need much greater supranational coordination of the policy mix in the future. The discussion about the Energiewende in Germany should be specifically orientated towards its benefits - in the form of export opportunities, jobs and its contribution to international climate protection and sustainable development, among other things.
Fraunhofer Institute for Systems and Innovation Research ISI