Governing energy transitions, and its politics


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Invited speaker to a conference at Tokyo University in February 2010.

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  • Member of SPRU, where look at the politics of sustainability transitions Studied and published the theory of Transitions Analysis; green niche empirical research in energy, housing and food; and also the Dutch experience. Classify myself as a critical friend Idea here is to raise a few challenging issues that confront attempts at sustainability transitions, and relate them specifically to Transitions Analysis Stress: I am European researcher. My role is to think about initiatives in context, and so tend to focus on the bigger questions rather than the detailed practicalities of design. Though these bigger issues will have some practical bearing. I am not here to tell Japan how to makes its transition analysis. Rather, I am here to say, here are some thing that we’ve been thinking about, especially in context of UK transition to a low carbon economy, what do you think? And to learn what they mean for you with your experience and positions here, if anything. Also, our research on the Dutch experience is already a couple of years old, and there may be developments that we have not kept pace with.
  • Set the scene by recalling the challenge – which is the transformation of highly complex, deeply embedded social and technological systems The UK government puts a lot of faith in innovation providing solutions, but also about unsettling structures too The pros of Transition Analysis are its socio-technical rather than technological focus PLUS its provision of a broad framework for positioning a portfolio of activities. The cons are an (understandable) inability to address the politics of transitions. This is not so much a criticism of Transition Analysis itself, but of a failure to put it within a broader political programme of radical sustainable development.
  • Taken from the Climate Change Committee report, Building a Low Carbon Economy, in December 2008. Stark illustration of the extent of decarbonisation required across many systems in society. Now legally binding on the UK government – hence new policy strategies like UK Low Carbon Transition Policy G8 L’Aquila statement in July 09 agreed to 50 per cent global targets; European Commission also talking about transitions. Implies the decarbonisation of entire sectors. Not just greening the flow of goods and services (commodities), but the transformation of infrastructures too, and their institutions too. From a TA perspective, a move from ‘embedding technologies in societies’ towards ‘technologies making societies’: transformations that reconfigure the way societies realise human needs for energy, mobility, food, and so forth. Most specifically, the ‘transition management’ movement advocates policies for deliberately modulating these processes in order to move towards particular visions of sustainability.
  • HMG (2008) – Building a low carbon economy: unlocking innovation and skills It remains a moot point in policy debates whether the low carbon technology comes first, inducing wider social changes (as the quotation implies), or whether social changes are required first in order that low carbon technologies become valued and developed. Why not a social revolution? Quotation implies social conformity: to the low carbon imperatives of the technology revolution. Role of civil society? To help people accept and adopt low carbon technologies.
  • A review of Low Carbon Energy Innovation Policy by BERR in 2008, in order to ensure the Environmental Transformation Fund provided strategic help Other indirect policies in the background, but that nevertheless influence the direction of LCIP: Climate Change Act targets; EU policies will have an increasing impact on direction of innovation: EU ETS; targets for renewables, efficiency etc
  • Slide from Michael Grubb via Steve Sorrell OTC = over-the-counter Phase 1 prices were volatile and they collapsed due to weak targets and the inability to bank allowances from Phase 1 to Phase 2. Phase 2 targets are better, but nothing like good enough. Prices have collapsed recently (not shown) owing to recession Volatility is worse when targets are weak. It is a major problem for investors who cannot predict future carbon prices and hence have difficulty in obtaining finance. 25 euro is 3000 yen Paradox: higher prices needed to induce investment, but how smoothly can that investment offset the impact of high prices, which is politically unpopular. IEA say carbon price will need to reach $50 by 2020 and $110 by 2030 (i.e. 50 dollars = 37 euro; 110 dollars is 82 euro)
  • Slide from Tom Reilly my colleague at SPRU Prices rising, but volatility still there. Some claim a minimum of 50 eruos per tonne is needed for investment to start flowing into low carbon: From Financial Times - IEA warns carbon price must double By Carola Hoyos and Ed Crooks in London, Published: November 10 2009 20:29 The International Energy Agency has warned that the price of carbon credits will have to more than double from the levels they now trade at in Europe to make high-tech solutions to climate change economically attractive. In its annual World Energy Outlook report released on Tuesday, the rich countries’ watchdog also warns that the world’s use of fossil fuels ? coal, oil and natural gas ? will have to peak by the early 2020s. Fatih Birol, the IEA’s chief economist, argues the world needs a “revolution” in the energy and vehicle industries. “ We need a deal in Copenhagen [at the climate talks]. We need a signal for the energy industry. Without that, nothing will move,” he says. In industrialised countries the price of a permit to emit a tonne of carbon dioxide will need to reach $50 by 2020 and $110 by 2030. In developing countries the price would need to reach $30 a tonne by 2020 and $50 by 2030. Carbon permits now trade at $21 a tonne in the European Union. In the US a carbon trading scheme is still being negotiated. The Senate, which is unlikely to pass any bill before next year, has set $48 as the maximum that carbon prices would be allowed to rise to by 2020. By 2030 that ceiling increases to about $90.
  • Some measures already cost-effective: non-technical barriers!? But must be lots of them … What happens before this point: who has been pioneering the commercial use of these expensive options? Need to understand the niches where they are taking root NOW, and then consider how to improve not just their economic performance, but the related social, technological, political and economic performance.
  • Dries Hegger, Jenneke Van Vliet and Bas Van Vliet, Wageningen (2007) ‘ Several potential breakthrough technologies are available and the real challenge is not technological experimentation but to deal with the complexity of the social reality, and to find opportunities for the modernization of existing systems.’ (p.743) Need an approach that places as much emphasis on the social as well as the technological; and that considers innovation to be about the co-evolution of society and technology. Significant features: a very linear model of innovation, a very technology-focused model A firm-based model of innovation Energy policy in the UK has a long-tradition of being quite closed, technocratic, and corporatist, and it seems LCIP is going the same way. Ignores long-standing research into actual innovation processes, which are non-linear, networked processes that require lots of different kinds of innovation, including social innovation, and that are not confined to the developing firm, but also include innovations in the behaviour of in society – not just as individual consumers, but as citizens and communities.
  • RD&D priorities – offshore wind, smart grids, marine renewables, low carbon vehicles
  • RD&D priorities – offshore wind, smart grids, marine renewables, low carbon vehicles
  • Think of this as getting electricity from the sea, and not as a technology per se. Also, realising in double sense: how best to achieve a known social need; but also how best to figure out what that (changeable) need is in the first place. SeaGen marine tidal stream generator. Needs many other things in place before it becomes commercially successful: Scientific knowlegde (e.g. materials science) Core technology; Investment; Viable electricity market price; Carbon prices that minimise risk; Access to the grid; Regulations that allow favourable access; Smart grid management – intermittency; Marine renewables engineers; Maintenance systems; Supply chains; Environmental impacts are known and reasonable; Socially acceptable All these interacting together determine whether the technology ‘works’: not just R&D subsidy plus market signals Will R&D plus carbon markets really align all these components into a working configuration? Policies are being layered onto the basic supports, e.g. training programmes, infrastructure provision. Unrealistic to expect a smooth development of a marine energy niche. But could lessons be learnt in a more rounded way? Articulate all these issues in coordinating arenas? Lots of learning from failure and long-term commitment. Note: this is still a technology-led example. Chosen because this is a more familiar point of departure. But a more interesting point of departure might be to start by thinking about 20 per cent carbon lifestyles, and all that this would entail. NB: this is for a technology and NOT an entire system of provision (like electricity), which bundle together many technologies and social practices. Systems innovation is an even greater challenge!
  • Capabilities. existing capabilities and knowledge, which channel technical developments in restricted directions; investments are constrained by existing beliefs and perceptions, routines and habits. (e.g. skills based in CCGT and centralised grid management) Economics. Existing technologies cheaper in the short run, benefited from long periods of learning by doing and using, scale economies and positive network externalities. (e.g. learning by doing over long periods, market rules assuming large generators) • Vested interests. sunk investments in capital, competencies and social networks. • Politics and power. Incumbent businesses, regulators and others enjoy important positions in the current system. Economic power bestows considerable influence; they have voices that will be listened to by innovation policy processes. ‘Outsiders’ need not be small players, for example large information technology companies are outsider innovators in energy systems but have a potentially transformative role to play in a move to ‘smart grid’ technologies. However, whilst today’s shareholders, workers and customers can vote and exert influence in other ways, tomorrow’s stakeholders in more sustainable systems are not a recognisable constituency. (e.g. energy sector workforce cf. future low carbon jobs; utilities operate essential infrastructure), Ideology: commitment to market-based approaches) • Infrastructure. Existing technological devices may be embedded in dedicated infrastructures that make their substitution with alternatives difficult. (e.g. grid serves fossil and nuclear technologies) • Institutions. Government regulations and subsidies, professional associations, and market rules have co-evolved as part of existing systems and tend to reinforce existing trajectories of development. • Market and consumer cultures. Prevailing market and social attitudes influence the kinds of technical performance deemed acceptable; whilst the business models, lifestyle norms and routines that are created around them can resist novel practices. (e.g. households and device manufacturers expect cheap and plentiful electricity)
  • Allure of this simple multi-level heuristic is an ability to cover the big, long-term picture. It can help us organise relations between more specific, in-depth considerations, e.g. the provision of skills in relation to niche markets, the influence of environmentalists in relation to pressure for incumbent businesses to become greener. LCL: low carbon lifestyles CRE: Community energy services
  • Transition analysis a process based framework for adaptive learning and intervention. Fundamental concern with these pragmatic activities is to learn more about socio-technical dynamics and seek institutional reforms that will permit the most promising niches and pathways to flourish. Problem-framing is central – but issue of frame conflicts not really considered. Implies an elite vanguard of strategic thinkers capable of knowing what is socially optimal, and that their deliberations should lead the future shaping of low carbon societies. Other aspects of transitions less prominent: empowering social movements and taking grassroots innovation seriously; destabilising and unlocking the incumbent energy system; redistributing resources. These are more overtly political tasks. Whose visions count? People frame current energy systems differently, see the challenges differently, prefer different alternatives. How to negotiate consent; and how to include dissent? Which niches to support; whose criteria? How diverse a range of socially and technologically led niches to support? Making sure technology does not eclipse behaviour initiatives? Plural criteria, or universal criteria, when to bring in market criteria? Whose lessons should drive future adaptations? Groups will draw different lessons from experiments. Niche pioneers are always convinced there time has come (e.g. organic activists 50 years ago). Others draw different conclusions. How to arbitrate? How to destabilise the regime? Incumbent energy practices need to be disrupted, even stopped, such that the alternatives become even more attractive. But we all depend on the incumbents, so how to unsettle without too much disruption? How to redistribute resources? LCT Plan implies a #### billion investments. Some of this will be redistributive. How to manage this process? How to avoid pork barrel politics? Some commitments will inevitably require long-lived infrastructures and institutions, which works against TAn’s desire to be adaptive. How to manage that tension? Where does this take place? This is both institutional and geographic. Institutionally: Which bits of government facilitate these initiatives; how does TAn sit relative to more established policy networks and institutions; how does TAn connect with important democratic institutions and public accountability? Geographically: important processes and elements of a transition operate above and below the national scale (e.g. business strategies of MNC, technology demonstration, urban infrastructure). How does TAn engage with processes beyond its jurisdiction?
  • Over 30 civil servants
  • TFE and IPE set up after initial platforms in order to provide high-level coordination. TFE task force chaired by Rein Williams, CEO of Shell Netherlands – business led; IPE intended to transmit policy lessons to government. Recommendations come up from platforms, and new platforms approaved by TFE and IPE. The energy transition project started in the Netherlands in 2001: it is led by Ministry of Economic Affairs, responsible for energy and innovation policy After consultation with stakeholders and a scenario study six themes which have been chosen to be of importance in a future sustainable energy system: biomass, gas, mobility, sustainable electricity etc: for each of them a permanent public-private platform has been set up which are said to be at the ‚heart of the approach‘ underneath each platform there are several working groups in which stakeholders come together and discuss certain specific options of interest to them Euro 2.4 billion, with 0.4 billio coming from public subsidy 409 projects in total
  • 80 per cent lifdestyle?
  • Non-voluntary since different to role out of the internet or other technological transformations. “A low carbon economy … will entail … the transformation of our lives and of our economy” (HMG, 2008: 2, Building a low carbon economy). Perhaps the abolition of slavery, urban sanitation, and the creation of the welfare state provide historical precedents. Whilst both involved political leadership, they were backed by mass social movements. Given the scale, and coercive quality of the change, there ought to be democratic oversight. Empowering low carbon citizens and communities might operate beyond TAn: could this scheme work for them? It is about community politics, and connecting concerns for low carbon transition with the more everyday and immediate concerns of people. Suggesting how lower carbon investment can bring hope and aspiration to those everyday lives. Political programme is not just setting legally binding targets (though this is good), but binding people to certain activities, whilst ruling other activities out. A political approach concedes that the learning in TAn is unlikely to be singularly rational: there will be conflicts over the lessons to be taken. Legitimacy may need to be won over in ways additional to framing quesrions and answers in the right way. To what extent are urgency and legitimacy in opposition? Is it possible to undertake urgent large-scale change without popular legitimacy, or will it be derailed? Will a focus on bottom-up legitimacy facilitate exponential growth in support? Can we learn from precedents in, say, abolition of slavery, or public sanitation, or weapons control?
  • Leave you with some open questions. Note that buried within the discussions of doing TM better, are issues of: early winners versus long-term change Adaptive, learning oriented approach versus politically togh choices over long-lived infrastructures and institutions Opening the diversity of participants Ensuring democratic legitimacy
  • Governing energy transitions, and its politics

    1. 1. <ul><li>Governing energy transitions, and its politics </li></ul><ul><li>Adrian Smith </li></ul><ul><li>SPRU – Science & Technology Policy Research </li></ul><ul><li>University of Sussex </li></ul><ul><li>Paper for the conference on Transition Management for Sustainable Society </li></ul><ul><li>Tokyo University, 13-14 February 2010 </li></ul>
    2. 2. Argument <ul><li>Climate change and secure energy: from diffusing cleaner technologies to wide-scale socio-technical transformation </li></ul><ul><li>UK illustration: recognising the transition challenge, but struggling to escape neo-classical economic framework </li></ul><ul><li>Transition analysis: a framework for understanding and coordinating complex, transformation activities </li></ul><ul><li>Dutch illustration: transition governance, but captured by existing energy policy network </li></ul><ul><li>A political programme for transition governance? </li></ul>
    3. 3. Transition imperatives? A UK illustration 2006 emissions International aviation & shipping* UK non-CO 2 GHGs Other CO 2 Industry (heat & industrial processes) Residential & Commercial heat Domestic transport Electricity Generation * bunker fuels basis 2050 objective 159 Mt CO 2 e 695 Mt CO 2 e 77% cut (= 80% vs. 1990)
    4. 4. <ul><li>“ A low carbon economy is not a slogan. It will entail, over the next few decades, the transformation of our lives and of our economy - as the Prime Minister has put it, a ‘technological revolution’ in the way we use and source our energy. And in turn - because energy use pervades every aspect of our lives - this will imply a social transformation, in the way we live .” </li></ul><ul><li>(HM Government, 2008: 2). </li></ul><ul><li>Moot point whether technological revolution comes before the social revolution (as implied by PM). </li></ul>Low carbon innovation policy in UK
    5. 5. Low carbon innovation policy in UK Source: BERR (2008) <ul><li>Market deployment : </li></ul><ul><li>emissions trading </li></ul><ul><li>tradable green certificates </li></ul><ul><li>energy efficiency commitments </li></ul><ul><li>capital grants </li></ul>
    6. 6. Carbon price has had a bumpy ride Phase I Phase II How high must prices rise in order to pull through path-breaking low carbon innovations in the energy sector? And how politically acceptable are high prices?
    7. 7. Carbon price has had a bumpy ride A plot of the prices of year-ahead EUA futures contracts
    8. 8. Innovations and abatement costs Some measures are already cost-effective, so why are they not more widespread?
    9. 9. <ul><li>UK LCTP = R&D subsidy + market signals = low carbon economy </li></ul><ul><li>Linear model of firm-based innovation cf. networked and distributed </li></ul><ul><li>Technology focused: nuclear; CCS; wind; tidal; …Pie charts and wedges </li></ul><ul><li>Emissions trading provides demand-pull for innovation </li></ul><ul><li>Results: </li></ul><ul><li>Low renewable energy capacity – two per cent energy, six per cent electy </li></ul><ul><li>Mass onshore wind is contentious; marine energy is finely balanced; offshore wind is rolling out slowly; micro-renewables market is small, CCS and nuclear much discussed - a few projects announced </li></ul><ul><li>Virtually no district heating and poor energy performance in buildings (though new-build standards are improving) </li></ul>Mixed results in the UK
    10. 10. UK Low Carbon Transition Plan (July 2009) Draws together the mix of existing and new initiatives into an overall plan for meeting the 2020 carbon reduction target of 18 per cent lower than 2008 levels A package of low carbon measures cf. a coherently co-ordinated programme for transition: RD&D subsidies, advice and information programmes, favourable land-use planning reforms and infrastructure agency, community engagement (see later) Carbon price through emissions trading remains the main pull for innovation LCIP = R&D subsidy + price mechanisms + friendlier planning + informed consumers
    11. 11. Transition analysis <ul><li>Historical studies of radical, wide-scale ‘socio-technical’ transitions suggests policy frameworks need to do three things: </li></ul><ul><li>Facilitating the development of path-breaking, innovative niches with wide-scale (and rapid) implications for low carbon energy </li></ul><ul><li>Destabilising incumbent energy regimes further and faster, thereby opening up opportunities for radical change </li></ul><ul><li>Helping investors, businesses, communities, and citizens to translate their interests and aspirations into innovative niches </li></ul>
    12. 12. Niches and path-breaking experiments Scientific knowledge Infrastructure Energy markets Carbon markets Grid management Institutions Environmental impacts Willing customers (utilities) Maintenance Social acceptability Skilled workforce Components Core technology Developing low carbon alternatives requires considerable agency, in order to align the material, institutional and discursive elements necessary for a ‘working’ socio-technical configuration : Niche policy = knowledge, technical, organisational, economic, and political work
    13. 13. High carbon regimes and escaping lock-in <ul><li>Incumbent systems of provision (e.g. electricity socio-technical regimes ) disadvantage niche activity due to mutually reinforcing path-dependencies: </li></ul><ul><li>Capabilities </li></ul><ul><li>Economics </li></ul><ul><li>Vested interests </li></ul><ul><li>Politics and power </li></ul><ul><li>Infrastructure </li></ul><ul><li>Institutions </li></ul><ul><li>Technological and user cultures </li></ul><ul><li>BUT </li></ul><ul><li>these regimes are under pressure too (e.g. environmental change, social pressure, demography, re-ordered discourses, internal dynamics and contradictions); </li></ul><ul><li>regime tensions provide opportunities for alternative niches </li></ul><ul><li>policies and programmes for sustainable transitions need to unsettle these regimes </li></ul>
    14. 14. Transition analysis: a multi-level perspective Source: Geels (2002) Future systems CCS CES Wave LCL Fossil fuelled electricity Wind
    15. 15. Transition Governance Source: Geels (2002) Pressure on regime to become sustainable Empowering environmental awareness and values Whose lessons should drive future adaptations? Whose visions count? How to redistribute commitments from regime to niches? How to destabilise the regime? Where does all this take place? Which niches to support; whose criteria? Pathways to visions Pathways to visions Visions for sustainable energy systems Visions for sustainable energy systems Visions for sustainable energy systems Socio-technical niches Socio-technical niches Socio-technical niches Socio-technical niches Appraisal / Social learning Commitments / Politics
    16. 16. Dutch Energy Transition Structure
    17. 17. Dutch Energy Transition Platforms <ul><li>Production </li></ul><ul><li>of biomass </li></ul>Energy in the Built Environment Sustainable Electricity Sustainable Mobility Chain Efficiency New Gas Biomass Import of biomass (under construction) Co-production Sustainable chemistry and innovative use of biobased resources Green gas Decentral Clean fossils Hydrogen Energy improvements in built enviroment hybridisation E 85/flexifuel Driving on natural gas and biogas Eco label Slim leasen Clean busses Sustainable paper chains Material reuse Renewal of production systems Development and implementation of innovations Removal of institutional barriers Electricity infrastructure Electricity use Offshore wind strategy group Sustainable agricultural chains Energy Transition Taskforce (TFE); Inter-ministerial Policy Directorate (IPE)
    18. 18. Criticism of the Dutch Energy Transition (ET) <ul><li>Government went to existing energy policy networks. Initially captured by incumbents. ET civil servants recognise they need to broaden participation. </li></ul><ul><li>Technology-based niches dominate (cf. social niches), selected on conventional RD&D criteria (CBA, NL plc) rather than path-breaking potential, plus pressure to demonstrate success through some early wins. </li></ul><ul><li>Tension between adaptability/learning and long-lived infrastructures not resolved. </li></ul><ul><li>Policies to destabilise the regime are poorly developed: ET needs to link more influentially to wider energy policy – legitimate authority (see later) </li></ul><ul><li>ET a conduit for RD&D rather than a programme for transforming regimes. Inherited energy institutions shaping transition policy more than the policy reforming institutions. </li></ul><ul><li>BUT, transition arenas provide opportunities for others to demand more, space for transition institutions to develop </li></ul>
    19. 19. <ul><li>Talking about the non-voluntary transformation of the everyday. </li></ul><ul><li>This makes it an issue for democratic politics, not just better process design. </li></ul><ul><li>Top-down, corporatist version of transition policy needs to balanced and complemented by bottom-up political activities that empower citizens and communities. Social change niches balance technology-led ones – community engagement in UK is interesting here . </li></ul><ul><li>A political programme creates powerful institutions built on a popular mandate, e.g. decentralises control over energy systems and redistributes resources </li></ul><ul><li>What signs are there that sustainability transition is a mass movement issue? Can we afford to wait? Conversely, is urgency on the scale demanded possible without widespread legitimacy? </li></ul>Transition politics
    20. 20. <ul><li>Transition processes: </li></ul><ul><li>who governs? </li></ul><ul><li>whose vision counts? </li></ul><ul><li>whose niches get prioritised? </li></ul><ul><li>which lessons should prevail? </li></ul><ul><li>how to destabilise the regime? </li></ul><ul><li>redistributing commitments? </li></ul><ul><li>where does all this take place? </li></ul><ul><li>Transition institutions: how can we ensure transition processes for low carbon path building are democratic and legitimate? </li></ul><ul><li>Transition politics: what might a broader political programme for transitions to low carbon societies look like? how to link the politics of substance with the details of process in transition policy? </li></ul>Conclusion: some open questions
    21. 21. More information … Transition analysis Smith, A. (2007) Translating sustainabilities between green niches and socio-technical regimes Technology Analysis & Strategic Management 19, 4: 427-450 Smith, A., Stirling, A. and F. Berkhout (2005) The governance of sustainable sociotechnical transitions, Research Policy 34:1491-1510. UK energy policy Scrase, I. and G. Mackerron (2009) (eds.) Energy for the Future Palgrave, London. Dutch energy transition policy Smith, A. and F. Kern (2009) The transitions storyline in Dutch environmental policy Environmental Politics 18, 1: 78-98 Transition politics Voβ, J-P., Smith, A. And J. Grin (2009) Designing long-term policy: re-thinking transition management Policy Sciences 42, 4: 275-302. Scrase, A. and A. Smith (2009) The (non-) politics of managing transitions to low carbon socio-technical systems Environmental Politics 18, 5: 707-726