The objective of this paper is to suggest a methodology that will help us t
o determine if the present rate and direction of technological change is co
mpatible with the development of a sustainable society. We combine two pers
pectives on technology assessment. The first focuses on current techno-econ
omic trends and the second on long-term resource and environmental constrai
nts to the diffusion of a new technology. We apply our approach to the case
of solar cells. Based on an analysis of technology, actor and market dynam
ics we suggest that thin-film solar cells are about to dominate the industr
y. Within the thin-film family, there is competition between alternative de
signs. The diffusion of three of these will, however, be limited by resourc
e, and perhaps emission, constraints. One design (a-Si) fares much better i
n terms of these constraints but is less efficient. Three policy issues are
identified. First, the diffusion of solar cells is not yet self-sustained
and further policy intervention is required. Second, the problems of the cu
rrent thin-him designs suggest that there is a need for policies both to su
stain variety and to balance that requirement with the short-term requireme
nt of cost reduction. Third, policy must ensure that a diffusion of solar c
ells containing scarce metals does not lead to an erosion of environmental
constraints. (C) 2000 Elsevier Science Ltd. All rights reserved.