In this paper we focus on understanding the rapid rise of the Chinese PV industry and its profound impact on the global PV industry. We investigate how it is possible that a nation that is still focusing on catching up in terms of industry, innovation and technology has been able to bring manufacturers from leading industrialized nations to their knees. This paper applies the framework of the Technological Innovation System (TIS), and also takes the cont. In this paper we focus on understanding the rapid rise of the Chinese PV industry and its profound impact on the global PV industry. We investigate how it is possible that a nation that is still focusing on catching up in terms of industry, innovation and technology has been able to bring manufacturers from leading industrialized nations to their knees. This paper applies the framework of the Technological Innovation System (TIS), and also takes the context into account, in terms of the Chinese national innovation system (NIS) and the global PV TIS. It concludes that the rise of the Chinese PV TIS can be explained by the interaction of three context factors (the change in Chinese institutions, technology transfer, and the large European market) and specific PV TIS dynamics. The study empirically shows the importance of extending the national TIS studies by including the influences of context factors.••Solar PVTechnological innovation system (TIS)Context factorsChinaThe market for solar photovoltaics (PV) is growing rapidly. In the past decade, solar PV generation has expanded by 50% per year worldwide. In 2012, solar PV generation reached almost 100 TWh, which is sufficient to cover the annual power supply needs of over 30 million European households. In the same year, the world's cumulative total installed capacity exceeded 100 GW, up from only 1 GW in the year 2000,.This rapid market growth is mainly due to a massive reduction in production costs. For example, the inflation-adjusted prices of crystalline-silicon (c-Si) PV modules have fallen from 5.0 USD/watt in 2000 to around 0.6 USD/watt in June 2014,. This sharp drop in production costs has mainly been caused by process innovations in manufacturing technology, such as improvements in wire cutting technology. In addition, mass production has led to more efficient and cheaper solar cell production machinery. PV production lines have been optimized, for example by developments in intelligent and self-correcting control of process flow, and this has increased throughput volume. Furthermore, the efficiency of solar cells and modules has increased, resulting in higher returns on investments.Lower prices are good for consumers and for governments that use financial i. 2.1. TIS and its contextsTIS approach views innovation as a collective activity and analyzes how innovations are developed and deployed through the complex interactions among a multitude of different actors and organizations that are enabled and constrained by physical artifacts as well as by institutions that are regarded as 'the rules of the game'. The TIS perspective has often been applied to describe and analyze the emergence of radical innovations,,,. Many of the studies have focused on sustainable energy technologies in various countries around the world,,,, and many apply the scheme of analysis suggested by Bergek et al. This scheme suggests that analysts should create insight into the structure of the innovation system (the network of actors, institutions and physical infrastructure) and complement these insights by focusing on the key processes that take place in the innovation system. Hekkert et al. propose the following key processes: entrepreneurial experimentation, knowledge development, knowledge exchange, guidance of the search, market formation, resources mobilization, and creation of legitimacy (the seven system functions). The focus on key processes or functions complements the analysis of the structure of innovation systems since many different structural configurations may lead to a similar performance of the inn. 3.1. The beginningPV in China can be dated back to 1958, when the first piece of silicon single crystal was invented by the Chinese Academy of Sciences (CAS). Subsequently, the new Institute of Semiconductors, a subdivision of the CAS, started researching solar cells. In 1968, the first solar cells aimed at uses in space satellites were successfully developed and manufactured by an institute in Tianjin; they were installed on China's second satellite, Practice I, in 1971. In the 1970s, a few factories in the cities of Shanghai, Ningbo and Kaifeng produced solar cells for satellites; these factories were operated by the government. It is believed that at the time there was hardly any difference between the efficiency of the solar cells developed in China and of those developed in western countries. In 1973, PV started to be used on land as the energy source for the beacon light in Tianjin port. In subsequent years, some PV demonstration projects were set up for military communication systems, systems for the protection of petroleum pipelines, microwave relay stations, water pumps, and rural broadcasting stations,.3.2. 1985–1996: the pioneering eraIn.
