Improving the Institutional Structures for Disseminating Energy Efficiency in Emerging Nations: Energy Agencies in South Africa

Emerging nations are typically characterized by high energy intensities despite significant energy efficiency potentials and numerous project oriented efforts to introduce energy-efficient technologies. The paper argues that successful technology dissemination needs appropriate institutional structures to reduce the related transaction cost. While a project-by-project approach risks to evaporate after completion, an energy agency would allow to bundle the know-how and information gained, ease access to funding and thus reduce information search cost and increase availability of efficient technologies. In a case study for South Africa, we examine the appropriateness of this concept for emerging nations. We discuss the underlying incentive problem from a New Institutional Economics perspective and suggest an approach to the design and implementation of operable energy agencies.