Interests in low-carbon technologies and renewable resources

The political economy context for transforming energy systems is shaped by domestic economic interests, societal and political values, and institutions. While recognizing interests in the energy status quo, this chapter focuses on interests in low-carbon alternatives and how they shape investments in knowledge and new capabilities necessary for low-carbon energy systems and implementation of policies that support them. Country capabilities and specializations in innovations and manufacturing are central to these foundational investments. Countries and firms that specialize in these activities are those that have largely initiated the technological disruptions to current energy systems, primarily by implementing market-creating and industry-supporting (industrial) policies. In addition, low-carbon technologies produce value from heretofore untapped renewable wind and solar resources and many developing countries are relatively well endowed with them. They are potential sources of long-run economic growth and new comparative advantages for developing countries in a world with net zero emissions from energy.