It's a bit surprising to me how few moderately important secondary powers there seem to be in the climate debate. It's really South Korea and Brazil... Maybe Indonesia. Saudi Arabia as well, I suppose, though in a very different way.
South Korea is in an interesting position because it's advanced enough to really cash in on a green tech market boom, but doesn't have the sheer market size-based power the major players do. South Korea has been fairly successful in playing the game with this handicap thus far. One of my fellow grad students writes about the different ways the South Koreans and Japanese have played the national vs. international markets game recently; in particular, he looks at the cellular market, where South Korea has been fairly successful in adopting international standards and selling into them, while Japan decided to define its own domestic technology standard for mobile phones, failed to spread it to any other countries, and... well, when was the last time you bought a Japanese phone? Japanese phones have the Japanese market cornered, though!
I'm returning to this idea of domestic vs. international markets in thinking about South Korea. Smart grid and related products are a natural market for South Korea given its industrial profile. And hey, look, they've got a smart grid roadmap! But they face several obstacles, most of which have to do in one way or another with the relationship between their prospective domestic and international markets. I'm working under the assumption - which I believe South Korea would agree with - that they need to be able to sell first to the domestic market successfully, but in such a way as to prepare them to sell successfully to international markets.
One is that a smart grid needs to have at its heart a flexible electricity market that can accommodate things like advanced metering, real time pricing - things that provide consumers with incentives to care about efficiency and demand response. Right now, Korea has a subsidized electricity market that doesn't give consumers these incentives. To provide a good domestic "nursery" for smart grid and related efficiency products that can ultimately be sold abroad, Korea needs to restructure its market to give its domestic consumers reason to care about - and pay for - these types of products. That means liberalizing and desubsidizing, which could create disruption, at least in the short term.
Even if that hurdle is overcome, though, it's not clear that the products that Koreans will want to buy will, in a general sense, be the same products that international markets will want to buy, not least because different international markets differ a lot in this area. The most obvious difference is the one between the fully industrialized countries, which are generally fully electrified, often with aging grids that need to be replaced, added on to, modified, and supplemented; and developing or transitioning countries like China and India where electrification is far from complete and there's huge scope for building smart grids from the ground up. But even within these broad categories, countries differ a lot in terms of what the existing power structure is, what needs the existing industrial profile imposes on it, and what current or future efforts are underway to integrate which kinds of renewable and/or decentralized generation. These differences may be more crucial, more constraining, and more complex than the inter-state differences that constrain a market like mobile phones (or, hey, they might not).
Some key questions might be, which country or set of countries does South Korea most resemble in terms of industry? Which does it want to? Whose strategy for integrating renewables will it most closely follow (it doesn't have a lot of renewables yet)? How much is it willing to distort or restructure its domestic market to prepare itself for selling outside its borders? Can it successfully sell into all markets, or might it need to focus? Could South Korea be a nice nexus point? Is it a little like the US, a little like Europe, a little like Japan, and a little like China?
It's a particularly important issue because South Korea is entering this market earlier than it entered the mobile phone market, such that it could face similar interoperability standards issues, but at an earlier point in their development where Korea could need to make more guesses - but, on the other hand, may have more opportunities to influence international choices. It doesn't want to get marooned - but on the other hand, it could become a leader. It needs to figure out where are the critical branching points, in terms of standards and usage characteristics, that could differentiate markets. How much can Korea lead or dictate by (say, by getting there first, heading meetings, and providing a focal point within a range of possible solutions), and how much will be determined by existing structures and conditions in key international markets?
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