Building CoPS Capability for Catching Up During Transitions: The Case of ACWA Power in Saudi Arabia

The energy transition is said to create emerging “green windows of opportunity (GWO)” in developing countries. On the other hand, many latecomer countries remain importers and users of renewables and clean energy technologies. Renewable energy deployment projects are considered complex systems and products (CoPS) that are capital-intensive, client-driven, and complex economic activities. Previous research on catching up in CoPS has concentrated on large engineering projects, focusing on technological aspects and the role of government interventions at different developmental stages, especially the creation of domestic markets. As many latecomer countries are users of emerging renewable energy technologies, the creation of domestic markets through government interventions is considered essential for successful transitions and capability upgrading to take place. However, capability upgrading and the transition to renewable energy can also occur without the initial presence of a domestic market and strong governmental support, as demonstrated by the case of ACWA Power, a project developer in a latecomer country, in Saudi Arabia. This case shows that upgrading of organizational capabilities took place as the firm engaged in projects in the external market to deploy renewable energy, taking advantage of the GWO. The case suggests that the CoPS can be a viable pathway for catching up in the emerging renewable energy sector, enabling firms to transition and build their organizational capabilities from project-based learning when GWOs are effectively leveraged.