Transforming the Energy System — the Evolution of the German Technological System for Solar Cells

TLDR

The study aims to deepen understanding of how new energy‑sector technological systems form and grow, and to pinpoint key policy challenges by examining the 25‑year evolution of Germany’s solar‑cell technology system. Employing a technological‑system framework, the authors trace the development of actors, networks, and institutions—from early knowledge build‑up under a federal R&D program through regulatory struggles to the establishment of a virtuous cycle of solar‑cell diffusion. They identify four critical insights: a coalition of system builders shaped regulation to create markets; a prolonged learning phase involving many actors; early market‑forming policies are essential; and simultaneous policies must preserve technological diversity.

Abstract

To improve our understanding of processes involved in the formation and growth of new technological systems in the energy sector and to identify the associated key challenges for policy makers managing the transformation process, we examine the development of the German technological system for solar cells over the past 25 years. We use a "technological system' approach in which we will trace the evolution of actors, networks and institutions that have a bearing on the generation and diffusion of solar cells. An initial preparatory stage lasted until about 1989 and was mainly characterized by knowledge build-up induced by a Federal RDD programme. This was followed by a second stage characterized by political struggle over the regulatory framework and a subsequent beginning of a virtuous circle for solar cells. In the concluding discussion, we emphasize four key features of the evolution of the technological system: (1) the role of a coalition of system builders that successfully influenced the regulatory framework so that markets could be formed: (2) the considerable length of the learning period and the large number of actors that need to learn; (3) the importance of policies that form early markets (not only early niche markets, but beyond those) as only markets may induce firms to enter and learn, and (4) the need to run market formation policies simultaneous to policies that maintain technological variety.