Energy systems and their transition V Filip Cernoch FSS MU CENTER FOR ENERGY STUDIES Socio-technical systems (MLP) Source: Geels, 2004, p. 903. Infrastructure does not work on its own, but through the involvement of actors and organizations. Infrastructural conditions form a context for action They enable and constrain. CENTER FOR ENERGY STUDIES The dynamics of energy systems (MLP) • System inertia — path dependence, locks-in, vested interests... • Socio-technical transition theory - the change of a system is a result of niche innovations, taking advantage of external pressure and, in cooperation with or against the opposition of status quo forces, gradually transforming system into its new shape. CENTER FOR ENERGY STUDIES The dynamics of energy systems (MLP) • Meso-level of the system itself. • Meta-level of the landscape — external factors (economic growth, globaÜ2ation, wars, systemic environmental changes etc.) that are beyond the controls of the actors of the system, changing slowly. They open the windows of oportunity for system change. • Micro-level of the niches — inkubators for radical technology development. Here technical advances are protected from market forces and are able to develop to a competitive state. CENTER FOR ENERGY STUDIES Technological substitution • Sudden changes on the landscape level + developed innovation(s) on niche level. • Innovations break in replacing existing regime. • That triggers competition between status quo actors, being defensive, and newcomers representing change. • Newcomers — new companies, activists, social movements, citi2ens, companies stretching their activities to new areas. • Downfall of incumbent companies. • Limited institutional change with innovations developed to fit into existing rules and institutions. • Or rules and institutions are adjusted to accomodate niche innovations. • Power struggles, social mobili2ation, counter mobili2ations. CENTER FOR ENERGY STUDIES British 'transition from sailing ships to steamships7 example • Sailing ship system with large and fast clipper ships stable and innovative in 1850s-1860s. • Steamships confined to small niches (inland waterways, steam tugs in ports to manoeuvre large sailing ships). • 1838 — British government created subsidi2ed market niche for mail steamers to improve communication within the empire. Steamers expensie but faster and more reliable. New community created. • Political revolutions (1848) and the Irish potato femine (1845-1849) formed landscape change that led to mass emigration to America. Steamships utili2ed that being equipped with new technology — screw propellers, increased efficiency of engines, iron hulls enabling building of bigger ships. CENTER FOR ENERGY STUDIES British 'transition from sailing ships to steamships' example Source: Lai Fong (Lai Fong of Calcutta, fl. 1870-1910) - Quids CENTER FOR Gallery, Public Domain. ENERGY STUDIES British 'transition from sailing ships to steamships7 example • Opening of the Sue2 Canal (1869) facilitating India and China trades — sailing ships are not allowed to Canal, continuing to going around Africa. • Replacement of sailships accompanied by development of new infrastructure — world coal market, enlarging of posts to accommodate bigger ships, machines for loading and unloading ships... • An effort of sailships producers to fight — biggers ships with more cargo. • Transition with technology-push character, where adjustments in the sociotechnical system followed the breakthrough of steamships. CENTER FOR ENERGY STUDIES Transition pathways - substitution Actors Infrastructure Institutions New firms struggling Radical innovation(s) Limited institutional against incumbent firms, leading to incumbents' overthrow. Different kinds of "new entrants" (e.g. citizens, communities, social movement actors, incumbents from different sectors) that replace incumbents. substituting technology. existing change, implying that niche-innovation needs to compete in the existing selection environment. CENTER FOR ENERGY STUDIES Transformation pathway • Moderate landscape pressure + unfinished niche developments. • Actors percieve the pressure and have desire to respond, but there is no technology available. • Social pressure groups (incl. those from outside of the sector) voice protest, accompanied by experts, researchers and companies. • New ideas to deal with the situation, accepted by actors as viable solution. • Innovation activities are reoriented to these new solutions. • New system emerges through cumulative adjustment and reorientation. • Existing actors adapt but survive, with some damages and losses. • Different level of institutional changes. CENTER FOR ENERGY STUDIES Dutch 'hygienic transition from cesspool to sewer systems7 example • System insiders (city governments, city councils, Department of Public Works) vs. outside criticism from hygienist doctors (in 1950 correlation between infectious diseases and filth discovered, resulting from overflowing cesspools and waste-dumping on streets and in canals). • Their demands downplayed, only incremental changes — dredging canals, pumping fresh water into them. Health seen as individual responsibility, not public issue (keeping taxes low for middle class population). • 1870s — 1880s escalation of the problem — with industriali2ation more people in slums without sanitary facilities. Doctors cooperate with engineers, pressing for sanitary reform. Cities are changing their policies — implementation of dry-collection system. Scale still limited. CENTER FOR ENERGY STUDIES Dutch 'hygienic transition from cesspool to sewer systems' example Source: tvtropes.org The Dung Ages CENTER FOR ENERGY STUDIES Dutch 'hygienic transition from cesspool to sewer systems7 example • In 1890s, cleanliness became a widespread cultural value — filth is no longer socially tolerated. • New civic spirit calling for more involvement from public authorities. More importance of working class. • Sewer systems implemented in The Hague in 1893, in Amsterdam in 1914. • = transformation path with gradual adjustments in regime rules (perceptions of disease and wastes, role of public authorities...). CENTER FOR ENERGY STUDIES Transition pathways - transformation Actors Infrastructure Institutions Incumbents reorienting incrementally by adjusting search routines and procedures Incremental improvement in existing technologies (leading to major performance enhancement over a long-term period) Limited institutional change Substantial change in institutions Incumbents reorienting Incorporation of symbiotic niche substantially to radically new innovation and add-ons technology or, even more (competence-adding, creative deeply, toward new beliefs, accumulation) missions, and business models Reorientation towards new technologies: a) partial reorientation (diversification with incumbents developing both old and new technologies b) full reorientation, leading to technical substitution CENTER FOR ENERGY STUDIES Reconfiguration pathway • Symbiotic innovations are adopted in the system to solve problems, based on their technical or economic superiority. • System stays intact initially, but over the course actors are active in implementing and using given technology. • This leads to major reconfiguration and system change. • New entrants may both compete or cooperate with status quo actors. • Since technologies are incorporated as modular innovations or addons —> new possibilities and problems. Transition pathway has a strongly open-ended character. • Limited institutional change is expected. CENTER FOR ENERGY STUDIES American 'transition from traditional factories to mass production7 example • Factory production as a complex, distributed system with many technical and social elements. Sequence of smaller and larger component changes led to reconfiguration to mass production. • In 1850s and 1860s new general-purpose machine tools (turret lathes, planners, boring machines ets), operated by low skilled labourers. Line shafts with friction and inflexibility. • 60s and 70s, processing industries (canning, meat packing, steel making) experimented with continuous movement in material handling (overhead conveyors, endless chains etc.). Small, battery-driven electric motors. • 80s — 90s — special-purpose machine tools with interchangeable parts. Canning industry pioneered combination of machine tools and conveyor belts. • Electricity. CENTER FOR ENERGY STUDIES American 'transition from traditional factories to mass production' example CENTER FOR ENERGY STUDIES American 'transition from traditional factories to mass production7 example • First decade of 20th century, industrial engineering, bigger companies (steel and reinforced concrete), more electric motors. • Automobile industry perfecting new production system based on special purpose machine tools, division of labour, interchangeable parts, electric motors, assembly line — Ford's factories. • Impact of landscape development — national market, population and economic growth, rising purchasing power, the rise of engineers, electricity... . • = interaction between multiple component innovation and the system. Not one breakthrough innovation, but sequences of multiple component innovations. CENTER FOR ENERGY STUDIES American 'transition from traditional factories to mass production7 example Source: Ford company CENTER FOR ENERGY STUDIES Transition pathways - reconfiguration Actors Infrastructure Institutions New alliances between incumbents and new entrants From initial add-ons to new combinations between new and existing technologies; knock-on effects and innovation cascades that change system architecture From limited institutional change to more substantial change, including operational principles CENTER FOR ENERGY STUDIES De-alignment and re-alignment pathway • Sudden and major changes on the landscape level (wars, economic collapses), causing actors to give up on the status quo (de-alignment) • System is not able to deal with problems, actors are looking for the solution at niche level. • If there is no one —> window of opportunity for multiple ideas, competing with each other. Eventually one wins, creating basis for a new arrangement (re-alignment). CENTER FOR ENERGY STUDIES American 'horse-drawn carriages to automobiles transition7 example • Late 19th century America in flux — urbani2ation, immigration, hygiene movement, electricity, political reform movements, expanding middle class with more money and free time, new values such as fun and active sporting. • Problems with horses — hygiene, longer travel distances, high costs of horse transportation. • Competition between different engines — with ICE winning. CENTER FOR ENERGY STUDIES Transition pathways - de-alignment and realignment Actors Infrastructure Institutions The collapse of incumbents because of landscape pressure, creating opportunities for new entrants Decline of old technologies creating space for several innovations which compete with one another Institutions disrupted by shocks and replaced, possibly after prolonged uncertainty CENTER FOR ENERGY STUDIES Transition pathways - reproduction Actors Infrastructure Institutions CENTER FOR ENERGY STUDIES Czech 'renewable energy transition' example • Energy transition (decarboni2ation) is in immature phase — RES account for about 11% of gross electricity generation (2016). RES are not able to challenge to traditional system of electricity provision. 14000 12000 8000 -_-■-■ ill ■ iii!MlM 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 waste 11 12 11 36 90 87 84 87 87 99 993 1231 1437 1512 1683 1803 1670 3007 3092 2067 183 214 414 598 933 1471 2241 2567 2614 2601 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 ■ Biologically degradable municipal waste 11 12 11 36 90 87 84 87 87 99 ■ Biomass 993 1231 1437 1512 1683 1803 1670 3007 3092 2067 ■ Biogas 183 214 414 598 933 1471 2241 2567 2614 2601 ■ Photovoltaic 2 13 89 616 2118 2173 2070 2123 2264 2132 ■ Wind 125 245 288 336 397 417 478 477 573 497 ■ Pumped storage 434 352 553 591 701 731 905 1052 1276 1202 ■ Hydropower 2090 2024 2430 2789 2134 2132 2856 1909 1795 2001 CENTER FOR ENERGY STUDIES Czech 'renewable energy transition' example Traces of 'substitution pathway'. • 1) Vehement external pressure (—»Act. No. 180/2005) EU Accession Agreement (based on Directives 2007/71/EC and 2003/30/EC) A greater renewable energy share in gross final consumption, reaching a level of 8% by 2010 and a level of 15% by 2030. A goal of a 5.75% share of bio fuels in transportation fuel by 2010. Directive of the European Parliament and of the Council 2009/28/EC A greater renewable energy share in gross final consumption, reaching a level of 13% by 2020. Directive of the European Parliament and of the Council 2009/28/EC A renewable energy share of 10% in all forms of transportation according to gross final energy consumption in transportation in the Czech Republic by 2020. A policy framework for climate and energy in the period from 2020 to 2030 (2030 Strategy) At least a 27% share of renewable energy consumption (a target obliging EU as a whole, not binding Member States individually). CENTER FOR ENERGY STUDIES Czech 'renewable energy transition' example • 2) Resistance of status quo actors, hoping to outlast a challenging technology with partial changes of their behaviour and strategies. • MPO: „Only minimal effort and money should be invested to fulfill the EU's RES goals." • CEZ: „the state is supporting it [RES], which means that from the business perspective it is a great idea. But people who do understand energy know what kind of energy nonsense it is." • CEPS: RES are a source of instability and incrased outlays in infrastructure and servising costs. Target gross production in electricity in 2040 (SEPU). 2016 data in brackets. Nuclear-fueled 46-58% (29%) Renewables and waste 18-25% (13%) Natural gas 5-15% (9%) fiFKITFR Hard and brown coal 11-21% (55%) ENERGY STUDIES Czech 'renewable energy transition' example • 3) Struggles between status quo actors and newcomers • Rather limited, since newcomers are considerably smaller and less influential. • Also limited share of RES —> traditional components of the system not challenged. CENTER FOR ENERGY STUDIES Czech 'renewable energy transition' example • 4) Existence of developer and employable innovative technologies. • They are available, but not in the C2ech Republic. • Technology is primarily imported from abroad. • Limited R&D in the C2ech Republic. CENTER FOR ENERGY STUDIES Sources • Gawande, A.: Getting there from here, 2009. • Unruh, G.C.: Understanding Carbon Lock-in, 2000. • Schmalensee, R.: Energy Decisions, Markets, and Policies, 2012. • Geels, F.W.(2006): Major system change through stepwise reconfiguration: A multi-level analysis of the transformation of American factory production (1850—1930). Technology in Society. • Geels, F.W.(2017): Typology of socio technical transition pathways. Research Policy. CENTER FOR ENERGY STUDIES