A recent example of this tension is within the solar power sector The tensions

A recent example of this tension is within the solar

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mitigation could easily devolve into new trade wars. A recent example of this tension is within the solar power sector. The tensions lead to protection-ist rhetoric and policies in China, the European Union, and the United States. The result has been market uncertainty within the still-nascent renew-able technology sectors. From a low-carbon development perspective, while developing countries require access to low- carbon technologies, assistance in their contextu- alization, and financing for their deployment, the imperatives discussed above necessitate a multiple- objectives policy approach. In summary, although competitiveness is a pressing issue for both devel- oped and developing countries, the two groups dif- fer on the starting point and the urgency of action. The resulting tension is a major impediment to global low-carbon development. 4.3 Incumbents versus newcomers At the company level, examples of responses to a changed business environment include the emer- gence of new firms and the transformation of exist- ing ones, as players jostle to gain the competitive advantage (and mitigate risk) in a shifting land- scape. For instance, the present fossil fuel-powered global economy consists of greatly different types of players: from fossil fuel producers (mining, oil companies, etc.), to operators that convert fossil fuels into usable forms of energy (power plants, engine manufacturers, etc.) to end users. Different low-carbon technology paradigms will necessarily disrupt existing value chains, affording opportuni- ties for new players to emerge and take their place. As low-carbon technologies are adopted globally, firms with strong capabilities in such technologies are poised to gain a large market in developed as well as developing countries. The uncertainty of the situation is illustrated by the nascent nature of low- carbon technologies; disruptive changes to existing models and the emergence of new mod-els toward low-carbon development are likely to continue. However, different technologies present dissimilar deployment propositions depending on the complexity of technology, the extent of impact on the incumbent system, and the cost of deploy-ment. For instance, it is easier to deploy nondis-ruptive low-cost and low-complexity measures to LOW-CARBON INNOVATION AND DEVELOPMENT 79
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improve energy efficiency by boosting component performance than to use complex, disruptive, and expensive technologies such as electric vehicles. A significant portion of the global innovation capability is vested in transnational companies (TNCs). Innovation for low-carbon development is no exception. As a recent UNCTAD report contends: Although international climate-change negotiations are proceeding slowly, the main issues of concern for developing countries – finance and technology – can be addressed partly through better harnessing of TNC resources (2010).
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