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ARTICLE IN PRESS
Energy Policy ] (]]]]) ]]]–]]]
Contents lists available at ScienceDirect
Energy Policy
journal homepage: www.elsevier.com/locate/enpol
Technology S-curves in renewable energy alternatives: Analysis and
implications for industry and government
Melissa A. Schilling Ã, Melissa Esmundo
Stern School of Business, New York University, 40 West 4th Street, New York, NY 10012, USA
a r t i c l e in fo
abstract
Article history:
Received 11 November 2008
Accepted 6 January 2009
Plotting the performance of a technology against the money or effort invested in it most often yields an
S-shaped curve: slow initial improvement, then accelerated improvement, then diminishing improvement. These S-curves can be used to gain insight into the relative payoff of investment in competing
technologies, as well as providing some insight into when and why some technologies overtake others
in the race for dominance. Analyzing renewable energies from such a technology S-curve perspective
reveals some surprising and important implications for both government and industry. Using data on
government R&D investment and technological improvement (in the form of cost reductions), we show
that both wind energy and geothermal energy are poised to become more economical than fossil fuels
within a relatively short time frame. The evidence further suggests that R&D for wind and geothermal
technologies has been under-funded by national governments relative to funding for solar technologies,
and government funding of fossil fuel technologies might be excessive given the diminishing
performance of those technologies.
& 2009 Elsevier Ltd. All rights reserved.
Keywords:
Renewable energy
Technological innovation
0. Introduction
Almost 85% of the energy used in the United States in 2007 was
generated from fossil fuels, with approximately 40% of total
energy coming from petroleum, 23% coming from natural gas
and 22% coming from coal. Nuclear energy...