Understanding and accounting for the effect of exchange rate fluctuations on global learning rates

Johan Lilliestam (), Marc Melliger, Lana Ollier, Tobias S. Schmidt and Bjarne Steffen
Additional contact information
Johan Lilliestam: Institute for Advanced Sustainability Studies (IASS)
Marc Melliger: Institute for Advanced Sustainability Studies (IASS)
Lana Ollier: Institute for Advanced Sustainability Studies (IASS)
Tobias S. Schmidt: ETH Zürich
Bjarne Steffen: ETH Zürich

Nature Energy, 2020, vol. 5, issue 1, 71-78

Abstract: Abstract Learning rates are a central concept in energy system models and integrated assessment models, as they allow researchers to project the future costs of new technologies and to optimize energy system costs. Here we argue that exchange rate fluctuations are an important, but thus far overlooked, determinant of the learning-rate variance observed in the literature. We explore how empirically observed global learning rates depend on where technologies are installed and which currency is used to calculate the learning rate. Using global data of large-scale photovoltaic (≥5 MW) plants, we show that the currency choice can result in learning-rate differences of up to 16 percentage points. We then introduce an adjustment factor to correct for the effect of exchange rate and market focus fluctuations and discuss the implications of our findings for innovation scholars, energy modellers and decision makers.

Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
https://www.nature.com/articles/s41560-019-0531-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nat:natene:v:5:y:2020:i:1:d:10.1038_s41560-019-0531-y

Ordering information: This journal article can be ordered from
https://www.nature.com/nenergy/

DOI: 10.1038/s41560-019-0531-y

Access Statistics for this article

Nature Energy is currently edited by Fouad Khan

More articles in Nature Energy from Nature
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().