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 ...
