Table Of ContentSustainability and Innovation
Coordinating Editor:
JensHorbach
Series Editors:
Eberhard Feess
JensHemmelskamp
Joseph Huber
Rene´ Kemp
MarcoLehmann-Waffenschmidt
ArthurP.J.Mol
Fred Steward
Forfurther volumes:
http://www.springer.com/series/6891
.
Dorothea Jansen Katrin Ostertag Rainer Walz
l l
Editors
Sustainability Innovations
in the Electricity Sector
Editors Dr.KatrinOstertag
Prof.Dr.DorotheaJansen PDDr.RainerWalz
GermanUniversityof FraunhoferInstituteforSystems
AdministrativeSciences andInnovationResearch
ChairofSociologyofOrganisation CompetenceCenterSustainability
Freiherr-vom-Stein-Straße2 andInfrastructureSystems
67346Speyer BreslauerStr.48
Germany 76139Karlsruhe
[email protected] Germany
[email protected]
[email protected]
ISSN1860-1030
ISBN978-3-7908-2729-3 e-ISBN978-3-7908-2730-9
DOI10.1007/978-3-7908-2730-9
SpringerHeidelbergDordrechtLondonNewYork
LibraryofCongressControlNumber:2011937373
# Springer-VerlagBerlinHeidelberg2012
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Preface
Theprospectofmodernsocietiesdependsontheirabilitytodealwiththechallenge
of climate change in the next decades. Technological innovations may help to
reduce the output of greenhouse gases. But barriers in the innovation process
seem to be a core problem. Thus, a better understanding of the functioning of
institutions and mechanisms governing the social and economic structure of the
energy sector, its innovation behaviour and the structure and behaviour of energy
consumersareatneed.
InGermany,energyandclimatepolicies arecharacterizedbypartlycontradic-
tory trends and ambitions. Driven by the integration of the Common Market we
witnessed a change away from public monopolies characterized by high supply-
securitystandards,highpricescoupledwithdisincentivesforenergyefficiency(e.g.
degressivepricepolicy),andinvestmentsintolargetechnologies.Theregimenow
evolvesinanewdirectiontowardsprivatization,legallyfreemarketentry,falling
pricesfollowedbylowerinterestinenergyefficiency,andgrowinginterestinsmall
scaleflexibletechnologies.Thesedevelopmentsalsocausechangesonthelevelof
actors. In particular, experts and local politicians mostly expected that municipal
utilities would not be able to survive under the new regulation regime. Today, by
contrast,wecanidentifyatleastsomeoftheseenterprisesamongthemostimpor-
tant actors in the energy market. Local utilities are also assigned a key role with
regard to energy efficiency innovations, due to their closeness to the final energy
consumer,andtheirimportantroleinthesupplyofcombinedheatandpower.Thus,
they appear to be important actors for pursuing the second political ambition, i.e.
climateprotection,whichismarkedbyaseriesoflaws,suchasthelawonrenew-
ableenergies(feed-inregulation)oroncombinedheatandpowerandtheintroduc-
tionoftheEUEmissionTradingSchemeforgreenhousegases.
Liberalization puts actors of the energy sector under much stronger market
pressure.Severalblack-outsinenergysupplyintheUSandinEuropemakeclear
that investment into the grid as well as into new technologies may become a pro-
blem under cut-throat competition. Whether utilities, energy suppliers and custo-
mers will take this road to the bottom or will be able to harness new and more
v
vi Preface
climate-friendly technologies (and services) is a central question for a sustainable
economy.
Againstthisbackground,thisbookfocussesonthemechanismsofdiffusionof
sustainability innovations in the electricity sector, namely renewable energies,
combined heat and power (CHP) as well as energy service contracting. The con-
tributionsidentifynationalandsectorspecificsofinnovationpatternsandmechan-
isms. Their general approach is centred on institutions, actors or functions within
suchasystem.Marketstructureandpublicsectortraditionsarediscussedaswellas
actorsandtheirinterests,strategiesandresources.Hence,thisbookrepresentsthe
continuation of earlier works published in the series “Sustainability and Innova-
tion” by Praetorius et al. (2009).1 It enriches the analyses presented there by its
particularfocus onthe roleofregulation, onmunicipal utilitiesasaspecificactor
group and by integrating an international perspective. Of particular interest is the
question of whether the joint effect of EU driven market liberalization and of
climate policies will succeed in establishing market forces that will drive actors
towardsmoreclimateprotectionorientedenergyproduction.Aspecialfocusison
the role of local utilities in the electricity sector as opposed to large transmission
netoperatorsorregional netoperators.Thecountries coveredinthecontributions
include Germany (Chaps. 1–7 and 10), Denmark (Chap. 6), the UK (Chaps. 7
and 8), Switzerland (Chap. 9), and the Netherlands (Chap. 10). In some of these
countries(esp.GermanyandSwitzerland)localutilitiesareimportantactorsinthe
innovation system, while other innovation systems, e.g. the UK, function without
suchanactorgroup.
ThefirsttwochaptersofthebookanalysethestrategiesofGermanlocalutilities
in the three selected innovation domains (renewable energy, CHP, energy service
contracting).Arangeofdeterminantsareidentified,whichinfluencetheirstrategic
choicesandtheirsuccessintheseinnovationdomains.Jansen–fromtheperspec-
tive of actor-centred institutionalism – focuses on electricity generation from
renewablesourcesandCHP.Thechangeofanenergysystemtowardssustainable
technologiesisconceptualizedasdependingon(1)achangeofactorswithrespect
tointerests,valuesandresourcesdependingonorganizationalandtechnicalstruc-
tureandknowledgeatthemicrolevel,on(2)achangeofcollaborativebehaviour
andownershipstructureatthemesoleveloftheenergysector,andon(3)achange
of institutions such as professional norms and regulation at the macro level.
Barnekow and Jansen (Chap. 2) analyse energy service contracting activities of
Germanlocalutilitieswithaspecialemphasisontwoselectedcustomergroups,i.e.
hospitals and butcheries. Both are known for their CHP potential. The analysisof
localutilitiesandenergyservicecontractingisthenbroadenedtoacomparisonof
different suppliers of this service in the contribution by Ostertag and Hu¨lsmann.
Comparative advantages of local utilities relative to important competitors in this
1Praetorius B, Bauknecht D, Cames M, Fischer C, Pehnt M, Schumacher K, Voß J-P (2009)
Innovation for sustainable electricity systems – Exploring the dynamics of energy transitions,
sustainabilityandinnovation.Springer,Heidelberg.
Preface vii
marketsegment(e.g.specialisedcontractors)areidentifiedonthebasisofhypoth-
eses derived from transaction cost economics using an econometric approach.
Governance structures as determinants for strategic choices are also at the center
of Chap. 4 (Jansen and Heidler), which looks at the drivers for and effects of
shareholding structures among local utilities and transmission net or regional net
operators and their influence for strategic choices in general, and for activities in
ourthreeselectedinnovationdomains,inparticular.
A core element of EU climate policy is the EU Emission Trading Scheme EU
ETS. Chapters 5 and 6 analyse its impacts on municipal utilities regarding their
activities in renewable electricity generation and CHP (Ostertag et al.) or their
activitiesregardingtheirCO performancemorebroadly(KnollandEngels).While
2
Chap. 5 looks at German local utilities and the first phase of the EU ETS (2005–
2007),theanalysesofChap.6coverthebeginningofthesecondphasefrom2008
onwardsandincludealsootherindustriesoutsidetheenergysectorandactorsfrom
Denmark.
The perspective of international comparative analysis is also adopted by
Praetorius et al. in Chap. 8. They compare the UK and Germany with respect to
“microgeneration” which includes small scale renewable energy plants and CHP
plants. The innovation systems in both countries differ strongly with respect
to actor structures and also regulation contexts. MacKerron (Chap. 9) gives some
reasonsforthisbyexplainingthestructuresoftheUKenergysysteminahistorical
perspective looking at the developments since World War II. The last two con-
tributions take a more narrow technological focus again and analyse biomass
technology in Switzerland (Wirth and Markard, Chap. 9) and in the Netherlands
and Germany (Negro and Hekkert, Chap. 10). They both use the “technological
innovationsystem”approach,whichisalsoprominentinPraetoriusetal.(Chap.8).
This book is one of the outcomes of the research project “Diffusion of energy
efficiency and climate change mitigation innovation in the public and private
sector”carriedoutjointlybytheGermanResearchInstituteforPublicAdministra-
tioninSpeyer(Germany)andtheFraunhoferInstituteforSystemsandInnovation
ResearchinKarlsruhe(Germany).Wegratefullyacknowledgethefinancialsupport
oftheVWFoundationforthisproject.
Speyer DorotheaJansen
Karlsruhe KatrinOstertag
RainerWalz
.
Contents
LocalUtilitiesintheGermanElectricityMarketandTheir
RoleintheDiffusionofInnovationsinEnergyEfficiency
andClimateChangeMitigation ............................................... 1
DorotheaJansen
MunicipalUtilitiesandthePromotionofLocalEnergy
EfficiencyProjects ............................................................. 27
SvenBarnekowandDorotheaJansen
GovernanceVarietyintheEnergyServiceContractingMarket ......... 41
KatrinOstertagandFriederikeHu¨lsmann
ShareholdingandCooperationAmongLocalUtilities:
DrivingFactorsandEffects .................................................. 57
DorotheaJansenandRichardHeidler
LocalUtilitiesUndertheEUEmissionTradingScheme:
InnovationImpactsonElectricityGenerationPortfolios .................. 83
KatrinOstertag,NeleGlienke,KarolineRogge,DorotheaJansen,
UlrikeStoll,andSvenBarnekow
ExploringtheLinkagesBetweenCarbonMarketsandSustainable
InnovationsintheEnergySector:LessonsfromtheEUEmissions
TradingScheme ............................................................... 97
LisaKnollandAnitaEngels
MicrogenerationintheUKandGermanyfrom
aTechnologicalInnovationSystemsPerspective .......................... 117
BarbaraPraetorius,MariMartiskainen,RaphaelSauter,
andJimWatson
ix
x Contents
InnovationandDiffusionofRenewablesandCHPintheUK:
RegulationandLiberalisation ............................................... 141
GordonMacKerron
TheContextofInnovation:HowEstablishedActorsAffect
theProspectsofBio-SNGTechnologyinSwitzerland .................... 151
SteffenWirthandJochenMarkard
IdentifyingTypical(Dys-)FunctionalInteractionPatterns
intheDutchBiomassInnovationSystem .................................. 175
SimonaO.NegroandMarkoP.Hekkert
