Global technology learning and national policy—An incentive scheme for governments to assume the high cost of early deployment exemplified by Norway

In this paper it is argued that technology learning may be both a barrier and an incentive for technology change in the national energy system. The possibility to realize an ambitious global emission reduction scenario is enhanced by coordinated action between countries in national policy implementation. An indicator for coordinated action is suggested. Targeted measures to increase deployment of nascent energy technologies and increasing energy efficiency in a small open economy like Norway are examined. The measures are evaluated against a set of baselines with different levels of spillover of technology learning from the global market. It is found that implementation of technology subsidies increase the national contribution to early deployment independent of the level of spillover. In a special case with no spillover for offshore floating wind power and endogenous technology learning substantial subsidy or a learning rate of 20% is required. Combining the high learning rate and a national subsidy increases the contribution to early deployment. Enhanced building code on the other hand may reduce Norway’s contribution to early deployment, and thus the realization of a global emission reduction scenario, unless sufficient electricity export capacity is assured.