An Exploratory Study of the South African Concentrated Solar Power Sector using the Technological Innovation Systems Framework Storm Potts 17337284 A research project submitted to the Gordon Institute of Business Science, University of Pretoria, in partial fulfilment of the requirements for the degree of Master of Business Administration. 7 November 2018 Abstract Wide-scale deployment of renewable energy is required to meet the global challenges of climate change and energy security. Solar photovoltaic (PV) and wind energy occupy the majority of global installed renewable energy technology (RET), but they are intermittent sources of energy and cannot be relied upon to solely meet the energy needs of the future. The problem of energy storage has therefore emerged as a significant barrier to the mass deployment of RET. Concentrated solar power (CSP), with its inherent storage capacity, offers dispatchable electricity at large scale. However, its deployment to date has been restricted by high capital costs and the limited geographical locations with optimal solar radiation to attain required efficiencies. South Africa, with its abundant solar resources, has the potential to develop an export competitive CSP industry by leveraging existing capabilities in innovation, manufacturing and construction. It has however yet to attain this goal. This study applies a qualitative, exploratory approach to understand the factors that are currently prohibiting South Africa from being the global leader in CSP by evaluating the functions of the Technological Innovation Systems (TIS) framework through semi- structured interviews with experts within the South African CSP TIS. The assessment revealed the presence of a largely unfulfilled TIS, with the advancement of the current TIS contingent on further allocation of CSP procurement targets in the Integrated Resource Plan (IRP) and sufficient support to develop entrepreneurial activity. A procurement-driven industrial policy strategy was recommended to address these barriers to further advance the diffusion of CSP towards the end goal of developing an export competitive industry in South Africa. Keywords Concentrated solar power, industrialisation policy, renewable energy ii © University of Pretoria Declaration I declare that this research project is my own work. It is submitted in partial fulfilment of the requirements for the degree of Master of Business Administration at the Gordon Institute of Business Science, University of Pretoria. It has not been submitted before for any degree or examination in any other University. I further declare that I have obtained the necessary authorisation and consent to carry out this research. ______________________________ Name 7 November 2018 iii © University of Pretoria CONTENTS 1. Chapter 1: Introduction to the Research Problem .................................................. 1 1.1 Background to the Research Study ............................................................ 1 1.2 Research Problem and Objectives .............................................................. 8 1.3 Significance of the Research ...................................................................... 8 1.4 Research Scope ......................................................................................... 9 2. Chapter 2: Literature Review ................................................................................10 2.1 Renewable Energy ....................................................................................10 2.1.1 Renewable Energy Technologies .......................................................10 2.1.2 Concentrated Solar Power ..................................................................14 2.1.2.1 Concentrated Solar Power Technologies ........................................16 2.1.2.1.1 Parabolic Trough Collectors .........................................................17 2.1.2.1.2 Linear Fresnel Collectors .............................................................17 2.1.2.1.3 Stirling Dish Technology ..............................................................17 2.1.2.1.4 Solar Tower Technology ..............................................................17 2.1.2.2 Global CSP Capacity ......................................................................18 2.2 The State of Renewable Energy in South Africa ........................................20 2.2.1 Renewable Energy Enabling Policy and Regulatory Environment in South Africa ......................................................................................................21 2.2.2 The Renewable Energy Independent Power Producer Procurement Programme (REI4P) .........................................................................................24 2.2.3 CSP Technology in South Africa .........................................................29 2.3 Sustainability Transitions ...........................................................................31 2.4 Technological Innovation Systems .............................................................32 2.4.1 Functions of a TIS ..............................................................................36 2.4.1.1 F1 – Entrepreneurial Experimentation and Production ....................36 2.4.1.2 F2 – Knowledge Development ........................................................36 2.4.1.3 F3 – Knowledge Diffusion ...............................................................37 iv © University of Pretoria 2.4.1.4 F4 – Guidance of the Search ..........................................................37 2.4.1.5 F5 – Market Formation ....................................................................38 2.4.1.6 F6 – Resource Mobilisation .............................................................38 2.4.1.7 F7 – Counteract Resistance to Change/Legitimacy Creation ..........38 2.4.2 TIS and Renewable Energy Technologies ..........................................39 2.5 Conclusion .................................................................................................44 3. Chapter 3: Research Questions ...........................................................................46 4. Chapter 4: Research Methodology .......................................................................47 4.1 Research Design .......................................................................................47 4.1.1 Research Philosophy ..........................................................................47 4.1.2 Approach and Purpose .......................................................................47 4.1.3 Research Method ...............................................................................48 4.2 Population .................................................................................................48 4.3 Time Horizon .............................................................................................48 4.4 Sampling Method and Size ........................................................................49 4.5 Unit of Analysis ..........................................................................................50 4.6 Measurement .............................................................................................50 4.6.1 Measurement Instrument ....................................................................50 4.6.2 Validity and Reliability .........................................................................51 4.6.3 Data Collection ...................................................................................52 4.7 Data Analysis .............................................................................................52 4.8 Limitations .................................................................................................53 5. Chapter 5: Results ...............................................................................................55 5.1 Sample Description....................................................................................55 5.2 Coding Themes .........................................................................................56 5.3 Results for Research Question 1 ...............................................................57 5.3.1 F1 – Entrepreneurial Activity ...............................................................58 5.3.2 F2 – Knowledge Development ............................................................62 5.3.3 F3 – Knowledge Diffusion ...................................................................68 v © University of Pretoria 5.3.4 F4 – Guidance of the Search ..............................................................73 5.3.5 F5 – Market Formation .......................................................................77 5.3.6 F6 – Resource Mobilisation ................................................................80 5.3.7 F7 – Counteract Resistance to Change/Legitimacy Creation ..............83 5.4 Results for Research Question 2 ...............................................................89 5.5 Results for Research Question 3 ...............................................................94 6. Chapter 6: Discussion of Results........................................................................ 103 6.1 Discussion of Results for Research Question 1 ....................................... 103 6.1.1 F1 – Entrepreneurial Activity ............................................................. 104 6.1.2 F2 – Knowledge Development .......................................................... 106 6.1.3 F3 – Knowledge Diffusion