June 7, Innovation systems and energy With a focus on The Netherlands Dr. Linda Kamp, STD Seminar 2013

June 7, Structure of this presentation My background Energy in the Netherlands – short introduction Two theoretical frameworks that can help us to understand current developments and provide pointers for action Application of derived insights – wind power in the Netherlands and Denmark STD Seminar 2013 – Lecture by Linda Kamp

June 7, My background Assistant professor at TU Delft, Faculty of Technology, Policy and Management since 2003 Focus on sustainable energy innovation processes and innovation systems in western and non-western countries PhD defense in Utrecht, 2002, on learning processes in wind turbine innovation systems in The Netherlands and Denmark Large role in TU Delft Master Program Sustainable Energy Technologies (SET) – responsible for Energy & Society graduation profile Co-ordinator of TU Delft Entrepreneurship Annotation STD Seminar 2013 – Lecture by Linda Kamp

June 7, Energy in The Netherlands - 1 Energy mix: Large oil and coal imports Large nuclear imports Only 3.8% renewables Own gas reserves Strong gas sector STD Seminar 2013 – Lecture by Linda Kamp

June 7, Energy in The Netherlands - 2 Netherlands very good at inventing innovative sustainable energy technologies energy kitesbladeless wind turbine But not so good at implementing sustainable energy technologies STD Seminar 2013 – Lecture by Linda Kamp

June 7, How to understand this? This presentation: two theoretical frameworks that help us to understand these developments in a systematic way and provide insights in how to influence developments. STD Seminar 2013 – Lecture by Linda Kamp

June 7, Emergence of novelty: innovation journey STD Seminar 2013 – Lecture by Linda Kamp

June 7, Multi-level perspective: static view STD Seminar 2013 – Lecture by Linda Kamp

9 Multi-level perspective: static view Things you cannot change Things you can change (but with difficulty) June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

10 Multi-level perspective: Agriculture Public opinion, Climate change, EU regulation, geopolitical relations Embedded energy system in a country New niche developments June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

June 7, Multi-level perspective – dynamic view STD Seminar 2013 – Lecture by Linda Kamp

June 7, Dynamics between the three layers - 1 Landscape developments can put pressure on the regime This can create opportunities for new technologies in niches If niche technologies have been sufficiently developed, they can enter the regime and Form part of the regime, or Overthrow the regime STD Seminar 2013 – Lecture by Linda Kamp

June 7, Dynamics between the three layers - 2 Or: Landscape developments and/or the regime constellation pose barriers for new technologies in niches Therefore niches remain small or fail STD Seminar 2012 – Lecture by Linda Kamp

June 7, Development and implementation of a new technology – dynamic view Focus of the analytical framework FIS

June 7, How to understand and influence these developments? Functions of Innovation Systems approach (FIS): an approach that can 1. help us to understand niche developments in a systematic way, and 2. provide insights into what is needed to influence / speed up niche developments STD Seminar 2013 – Lecture by Linda Kamp

Innovation system (social) system that produces and diffuses knowledge and technologies Knowledge + technology Actor networks Institutions June 7, STD Seminar 2013 – Lecture by Linda Kamp

17 Knowledge and technology ‘Hardware’ Knowledge gained by: -Learning by searching (R&D) -Learning by doing (practical knowledge) -Learning by using -Learning by interacting June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

18 Companies Actors are individuals and organisations that are involved in developing and/or implementing technology Actor networks GovernmentsKnowledge institutes Other involved organizations Users / market June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

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20 Institutions Institutions are ‘rules of the game’ that influence technology development and implementation Examples: -Laws -Policy measures and programs -Formal policy goals -Already available knowledge -Local technical circumstances e.g. the state of the electricity grid -Local cultural circumstances -Local political circumstances -Local habits June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

21 Innovation systems alignment June 7, 2016

22 Functions of innovation systems model: Hekkert et al. For an innovation system to be successful, 7 functions need to be fulfilled: 1.Entrepreneurial activities 2.Knowledge development 3.Knowledge diffusion – between researchers, firms, policy makers and technology owners 4.Guidance of the search – e.g. via policy goals and programs 5.Market formation 6.Mobilization of resources – capital, human capital, physical resources 7.Support from advocacy coalitions – to make resources available and to counteract resistance from stakeholders with vested interests STD Seminar 2013 – Lecture by Linda Kamp

23 How can MLP and FIS help to understand developments? - 1 Public opinion, Climate change, EU regulation, geopolitical relations Embedded energy system in a country New niche developments June 7, 2016 STD Seminar 2013 – Lecture by Linda Kamp

June 7, How can the MLP help to understand developments? - 2 Some current characteristics of Dutch energy regime: Large power of power production companies Focus on large-scale centralized energy and electricity production Focus on cost efficiency STD Seminar 2013 – Lecture by Linda Kamp

June 7, How can the MLP help to understand developments? - 3 Other new developments form separate niches PV Wind tubines Biofuels Etc (still) more expensive Suited for local (and centralized) electricity production Relatively new, smaller companies with less power STD Seminar 2013 – Lecture by Linda Kamp

June 7, How can the MLP help to understand and influence developments? - 4 Each niche aims to grow out in a well functioning innovation system => alignment of (1) knowledge and technology, (2) networks of actors, (3) institutions (=rules) Each niche has its own requirements in terms of Need for technology and knowledge (different kinds: R&D, user preferences, etc.) Need for involvement of specific actors Needed institutions and insitutions changes (including e.g. regulations, laws, cultural aspects, etc) Each niche should aim for fulfillment of 7 System Functions ** STD Seminar 2013 – Lecture by Linda Kamp

June 7, Application of frameworks on wind power NL – DK Both countries very good wind resources Both countries started policies in the 1970s Both countries ambitious aims and targets NL long history of windmills NL strong aerodynamic research (aviation) However, NL much less successful regarding windpower than DK Why?? STD Seminar 2013 – Lecture by Linda Kamp

28 Functions of Innovation Systems 7 ‘functions’: 1.Entrepreneurial activities 2.Knowledge development 3.Knowledge diffusion 4.Guidance of the search 5.Market formation 6.Mobilization of resources 7.Creating legitimacy MLP : regime, landscape

29 Landscape Similar for both countries: oil crisis, similar economic situation Regime NL: Gas reserves Very strong energy sector DK No gas reserves Less strong energy sector

30 Function 1: Entrepreneurial activities incumbents and/or new entrants / startups Outcome of analysis of wind turbine development in The Netherlands and Denmark : In both countries companies around 1980 In NL in 2000 almost all bankrupt; in DK strong world-leading sector

31 Function 2: Knowledge development learning by searching learning by doing learning by using done by universities, research centers, R&D departments of firms, users Outcome of analysis of wind turbine development in The Netherlands and Denmark : in NL mainly learning by searching (R&D) until late 1990s in DK all types of learning equally important

32 Function 3: Knowledge diffusion interactive learning within the same or between different actors categories Outcome of analysis of wind turbine development in The Netherlands and Denmark : strong differences here! In DK lot of interactive learning, also with users In NL hardly any user involvement

33 Function 4: Guidance of the search laws policy programs already available knowledge local technical circumstances e.g. the state of the electricity grid local cultural and political context Outcome of analysis of wind turbine development in The Netherlands and Denmark : in both countries large number of policy programs and goals in DK historical importance of cooperatives / local initiatives which fitted well with windpower & increased learning in NL hardly any cooperatives

34 Function 5: Market development market size and characteristics market stimulation measures Outcome of analysis of wind turbine development in The Netherlands and Denmark : In the Netherlands the market subsidies started at a very late stage => market remained very small. In Denmark market subsidies started early => larger market => more wind turbines sold and more feedback from the market to the companies

35 Function 6: Mobilization of resources capital resources human resources physical resources Outcome of analysis of wind turbine development in The Netherlands and Denmark : All resources are important, not only investments in R&D (which were larger in NL)

36 Function 7: Creating legitimacy incumbent system in which technology will be implemented– e.g. the energy production system lobbying for legitimacy/support/policy measures/subsidies Outcome of analysis of wind turbine development in The Netherlands and Denmark : NL: very powerful energy production sector that opposed wind turbines for a long time. However they were the foreseen users. NL: some lobbying activities but not successful DK: less strong energy production sector that was more cooperative More successful lobbying also because of more successful sector

37 How can this be useful for you now? Broaden your knowledge / insights / overview More schematic overview of current situation – landscape, regime, niches and interplay between these More insight into ‘who should do what’ regarding development and implementation of niche technologies – FIS functions

38 Any questions??