The effects of a Swedish investment support for photovoltaics on public buildings - An analysis of the dynamics of the innovation system

Examensarbete för masterexamen

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Type: Examensarbete för masterexamen
Master Thesis
Title: The effects of a Swedish investment support for photovoltaics on public buildings - An analysis of the dynamics of the innovation system
Authors: Porsö, Johanna
Abstract: The investment subsidy for PV (photovoltaics) installations on public buildings started in May 2005 and will end in December 2008. The aim of this thesis is to evaluate the impact of the investment subsidy on the dynamics of the PV innovation system. By identifying inducement and blocking mechanisms for further growth, the thesis also aims to give input to the discussion on how to continue supporting the PV innovation system. A major observation made is that the Swedish innovation system for PV actually consists of three isolated subsystems: research and solar cell production, PV module manufacturing and PV system installation. It is shown that the two first mentioned subsystems are not affected by the investment subsidy and that their major driving force is the strong world market for solar cells and modules. The subsidy has, however, had a significant impact on the subsystem around the PV installations, as it has created a market space for PV installations. This has led to an increasing amount of firms working as PV consultants and PV system installers. The subsidy has also led to an identification of a range of institutional problems affecting the subsystem around PV installations. These include the high costs of grid-connection, the Public Procurement Act, building permits and decisions made by the National Heritage Board concerning PV systems on churches. Concerning a future policy to strengthen the innovation system for PV some issues are discussed in the thesis. Firstly, the entry of actors should be encouraged in order to develop the system. A future policy should aim to broaden the actor base and include actor groups which are not present in the innovation system today, e.g. the construction sector and the energy sector. This could be done by stimulating the development of a solar electricity market, including system buyers that do not have to comply with the Public Procurement Act in a future investment subsidy scheme, encouraging building integrated PV solutions and integrate knowledge about PV in educational programs related to the construction sector. Furthermore, a very important aim should be to make the policy long term in order to reduce the uncertainty for the involved actors. Secondly, an important point is knowledge development and diffusion. In order for the knowledge acquired by the actors involved in PV installation to be utilized, repetition should be encouraged. Knowledge development is also connected to platforms where actors can meet. These platforms, e.g. seminars, make it possible for the actors to share knowledge and discuss problems. Thirdly, the Government should aim at a policy with as high efficiency as possible, i.e. a policy that produces most in terms of value in relation to the resources spent. Values for the system buyer include the amount of electricity produced but also other diverse values like PR and goodwill. By choosing a support level that is low enough the system buyers will be forced to take such values into account, as the investment will not be economically profitable by only accounting for the electricity produced. In the end, a subsidy can only be justified by the value it creates for society. The values gained are that knowledge and legitimacy are built up around a technology that could be of great importance for energy supply, the environment and industrial vitality in a not so distant future. The creation of a complete innovation system structure is of value, where all the relevant actor groups are represented. With the current subsidy the results have been mostly connected to the installations, but the aim should be to make a positive impact in the whole industry. Finally, the thesis concludes that there are many issues to target simultaneously from different angles concerning the development of the PV innovation system. The investment subsidy is only one of them. There are additional actions that should be considered in parallel in order to drive the industrialization of PV in Sweden further. But a continued market support program is essential to keep the subsystem around the PV installations going. With some modifications a ii broader range of actors can be stimulated to get involved increasing the breadth and pace of development.
Keywords: Miljöteknik;Environmental engineering
Issue Date: 2008
Publisher: Chalmers tekniska högskola / Institutionen för energi och miljö
Chalmers University of Technology / Department of Energy and Environment
Series/Report no.: Report - Division of Environmental Systems Analysis, Chalmers University of Technology : 2008-8
Collection:Examensarbeten för masterexamen // Master Theses

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