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The Effect of Local and Global Learning on the Cost of Renewable Energy in Developing Countries

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Joern Huenteler, Christian Niebuhr, Tobias S. Schmidt
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This paper uses a case study of Thailand's electricity sector to create realistic estimates for the relative contributions of local and global technological learning to reducing high upfront costs, which are a critical barrier for investments in clean infrastructure technologies in developing countries. The authors discuss implications of such learnings for international climate policy. For six renewable electricity technologies, they derive estimates for the share of locally and globally sourced goods and services, and they analyze the effects of local and global learning during the implementation of Thailand's renewable energy targets for 2021. Their results suggest that, in aggregate, the largest potential for cost reduction lies in local learning. Their results also show that the relative importance of local and global learning differs significantly between technologies and is determined by technology and country characteristics.