Supporting international technology cooperation in contested markets Technological Trajectories Conference, Bonn, 8 April, 2014 Shikha Bhasin, ECN
International technology cooperation the trade-offs What is international technology cooperation? Handling different interests: the example of Sino German electromobility cooperation What the Germans want What the Chinese want Ways forward The role of multilateral TC Ways forward 2
International technology cooperation: The trade-offs Global goods perspective: Accelerate low carbon technology experimentation, development, deployment globally 70% of emissions to come from developing countries in next three decades (IPCC 2013); require financial, technical, informational capacity to catch-up sustainably. vs. desire to exploit knowledge/innovation advantages nationally Assumed to be technologies of the future, eg. solar growing at 30% annually on avg. for 20 years (PWC 2013) 2/3 investments in clean energy technologies come from developed countries companies (OECD 2013); market doesn t reflect global goods benefits! 3
International Technology Cooperation Implies Financial and technical assistance that support and undertake joint actions with actors and institutions across national borders directly looking to impact a technology s innovation cycle. Main challenges: Balancing of inherent trade-offs Goes beyond transfers of hardware and codified knowledge: encompasses innovation systems surrounding technologies; actors, institutions and linkages 4
International Tech. Cooperation: Case of Sino- German Electric Vehicles Initiative (1) German EV ambitions: Lead provider, and lead market for EVs# Maintain technological leadership, avoid leakage Keep within the EU emission norms (for fleets) Use renewable energy for electricity fuelling EVs Chinese EV ambitions: Industrial and market leadership Catch up technologically, break into MNC knowledge pools Curb oil imports, Lower local air pollution China's and Germany's objectives Scope of Cooperation Reduce emissions globally Positive Reduce emissions from automobile sector nationally Positive Increase market access Mixed, depending on 'rents' and entry barriers Increase national industrial competitiveness, emerge as lead technology provider Negative 5
(2) 6
Operational Spheres of Bilateral Cooperation on Electromobility Initiative Research (a) University level partnership Research (b) EIA of EVs in China Research (c) Policy assessment of EVs in China s Public Fleet Norms/Standards (a) Standardisation Commission Predominant actor in Agenda Setting Established on Chinese insistence from the Ministry of Science and Technology Funding Agency Majority funding by BMBF, Germany IPR/Knowledge Ownership accrue to: University legal frameworks will apply German BMU BMU, Germany Public domain German BMU BMU, Germany Public domain German industry through the BMWi BMWi Public domain Benefits accrue to: EV innovation system Environmental impacts of EVs in China Environmental impacts of EVs in China Environmental impacts of EVs in China; and German OEM competitiveness Norms/Standards (b) Recycling of strategic components German industry through the GIZ and BMU 70:30 partnership between the BMU and the NDRC, respectively Public domain Environmental impacts of EVs in China; and German OEM competitiveness 7
No German or Chinese positions, rather coalitions of actors wanting to make progress: environmental standards, and competitive gains are being negotiated and raised within China, for both, German and Chinese companies. Oriented towards policy and regulatory frameworks Proof of public-private alliance working for raising environmental standards. However, limited progress, trade-offs remain, trust deficit an issue. 8
Ways Forward: Bilateral Cooperation Develop technological innovation systems relative to an emissions baseline in China. Electromobility could play a critical role in avoiding emissions from China s transportation sector. A next step for bilateral Sino-German cooperation could be to set up a joint working group that develops a technological roadmap for China driven from an environmental logic and emissions outcome. Develop innovation plans for the technology bilaterally, aligning these with areas of strong capabilities in each country. Mutual learning on policy good practices and learning mechanisms (e.g. NPE) 9
Ways Forward: Bilateral Cooperation Link ongoing city level pilot and showcase projects of both countries through the creation of a research programme with ownership from both governments. This would undertake a comparative study of the impacts of these projects in each country, and draw out lessons from consumer behaviour and market development. This would be similar to the German concept of Begleitforschung ( accompanying research ). Continue negotiating for emissions standards and establish voluntary environmental benchmarks for recycling of component materials and renewable energy use for charging electric vehicles. 10
Electromobility: Multilateral cooperation IEA s EVi: Primarily a knowledge sharing network, showcase bestpractice examples for urban Electromobility (IEA 2012). This initiative includes both China and Germany as participants, and through the network linkages the EVi provides, Volkswagen has announced that it would be undertaking demonstration activities in a special ''China Demonstration Zone'' to be set up by the Government there. It does not fund actual research or city partnerships, rather brings together practitioners who are all focussed on building EVs as a mobility solution and product; and is particularly focussed on highlighting the relevance of policy frameworks required for successful development and deployment of this technology. 11
Facilitating International Technology Cooperation: Ways Forward Need for a global institution and norm on low-carbon technology cooperation UNFCCC s Technology Mechanism takes cognizance of the innovation system for technology cooperation. But it must still: Engage with the Business Community PPP across developed/developing country divide Integrate standards &norms, setting environmental benchmarks Create space for companies to come on board the TM Facilitate business enablers (policy balances) IPR Patent Pools => who funds, governance? Climate Funds? A CGIAR for low-carbon technologies? 12
Thank you for your attention! 13