Supply-Side Determinants of Energy Consumption and Efficiency (ECE) Innovations.

Abstract

This paper empirically analyses the supply-side determinants of eco-innovations related to Energy Consumption or Efficiency (ECE) for electricity and other energy sources. Using preliminary firm-level data from a 2010 survey of innovation activity in Tasmania (a regional economy and state of Australia), a multinomial discrete choice model is employed to test the research hypotheses. The analysis shows the positive association between technological and organisational capabilities and ECE outcomes in electricity and other energy sources, with a specific effect from investment in external R&D. We also find differences in sectoral technological opportunities for ECE innovation and a positive effect for firm structure and size. Our contribution is to show the importance of supply-side factors on ECE innovation outcomes and draw attention to their potential policy relevance.