The Globalization of Clean Energy Technology: Lessons from China is a thoroughly researched and well-written book and an important contribution to the subject of clean tech innovation.
Five years in the making, Kelly Sims Gallagher’s book uses case studies of four clean energy industries (gas turbines, solar PV, coal gasification, and advanced batteries) in China to learn lessons about international technology transfer.
To guide her research, Gallagher asked these questions:
Which barriers most inhibit the global diffusion of cleaner and more efficient energy technologies?
Which incentives or conditions are necessary to motivate the global diffusion of these technologies?
Through dozens of interviews with individuals in firms, academic experts, and government officials, as well as focus groups, patent analysis, and comparative policy analysis, the book does much to uncover which commercial and policy factors have positive or negative effects on the clean energy industries examined.
I particularly like the organization of the book. After an introduction and a chapter on China’s energy and environmental policies and innovation system, Chapter 3 presents the case studies as “complete stories” and introduces barriers and incentives to global diffusion of clean technologies.
The case studies represented both “successful” (solar PV) and “failed” (gas turbines) technology transfer and some mixed results (advanced batteries for vehicles and coal gasification).
Subsequent chapters provide detailed analysis of three of the most critical actual or perceived barriers – policy, intellectual property, and cost/finance.
The conclusions Gallagher draws are that national market-formation policies and access to capital are the most important factors needed for global diffusion of clean technologies.
Intellectual property is not generally found to be an impediment to clean tech innovation and transfer:
One set of barriers/incentives that this research does not find significant for the cross-border diffusion of cleaner energy technologies is access to or infringement of intellectual property.
However, there have been some refusals to license, including Toyota HEV patents:
The Chinese have not been able to obtain licenses from Toyota for hybrid-electric technology, and they further think there is no room for Chinese innovation because the Japanese firms have defensively patented the entire space.
But even this may be a blessing in disguise as the Chinese may be leapfrogging to EVs.
One refreshing thing about this book is that Gallagher has no apparent agenda (a marked departure from some literature on the subject). She writes in the mold of some of the economists who have studied the effects of patents on clean tech such as John H. Barton. The book is empirically focused; Gallagher wants to find the facts and get to the bottom of it.
And get to the bottom of it Gallagher does. She finds “widespread agreement that the most important incentive is national-level, market-formation policies.”
The Chinese and foreign experts she interviewed agree that such incentives have encouraged cross-border transfer of the four clean technologies studied – policies including clear targets over time, lack of significant barriers to trade and foreign direct investment, strong innovation policy, stable market-formation policy, and strong export promotion policy.
An extra feature, and another reason to buy this book, is the nearly comprehensive list of case studies on clean tech transfer in Appendix B.
In conclusion, Gallagher’s book is a major contribution to the clean tech innovation literature. She explains the nature of the contribution concisely:
One of this book’s contributions is to clarify which barriers and incentives for the global diffusion of cleaner energy technologies are most important in the Chinese context, and, ideally, more generally.