Future Installation, Production and Global Trade of Clean Energy Technologies.

Hembach-Stunden, K., Banning, M., Becker, L., Lutz, C., Matschoss, P., Klann, U. & Horst, J. (2024): Future Installation, Production and Global Trade of Clean Energy Technologies. Sustainability 2024, 16(23), 10482, https://doi.org/10.3390/su162310482

Abstract

While transitioning to clean energy technologies offers countries economic advantages, the risk of “low carbon leakage” arises if production shifts to more favorable locations. We conducted a scenario analysis to examine potential shifts in production and trade patterns of clean energy technologies. Our novel empirical approach combines the global macroeconometric model GINFORS-E with a newly developed gravity trade model and integrates a socio-political analysis based on a Multi-Level Perspective (MLP) framework, innovatively augmented by quantifiable indicators. The MLP-analysis defines the expansion paths of clean energy technologies in an alternative scenario, allowing us to incorporate political and social dynamics into our analysis. The baseline scenario is based on announced pledges. For established technologies like photovoltaics, we observe minimal shifts in global trade shares as production capacities approach their limits, signaling market saturation. Conversely, emerging technologies like hydrogen electrolyzers display greater shifts, highlighting potential for market disruption and increased risk of low carbon leakage. While adopting clean technologies in individual countries lead to sector-specific changes, broader macroeconomic impacts appear constrained by existing market structures and path dependencies. Sensitivity analyses suggest that component-specific price changes influence trade and production. Expanding our approach to additional technologies and countries remains challenging due to data limitations.

Keywords: 

energy transition; decarbonization; international trade; macroeconometric modeling; MLP-analysis; scenario analysis