energy transition approach: ultimate challenge for sweden

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Energy Transition Approach: ultimate challenge for Sweden Stockholm, 13 May 2014

The Global Energy Transition

has reached the tipping point

Through development stagePre-development stage

Renewables

Decentralized

Bottom-up

Fossil

Centralized

Top-down

Time

Sustainable Energy System

We are here

Tipping Point

Transition to Sustainable Energy

Tipping Point Phase

chaos

conflicts

battlefield

Chaos & Turbulence

3 years ago: nuclear renaissance by now: nuclear pathwork

5 years ago: US largest importer of gas by now: US exporter of gas to Europe

4 years ago: price of solar panels high by now: price of solar panels 60% lower

Old Order & New Order old fossil order

– shale gas and unconventional oil in the United States – surplus of cheap coal to Europe

huge CO2-emissons and environmental pollution

new renewable order– China is the big motor behind ‘clean tech’– China plays double role, big investments in fossil fuels

still small, but fastly growing

Global Energy Battle Field

Obama

“ The country that will dominate the clean tech economy

will be the country that will dominate the world economy

and America needs to be that country ”

global economy around ‘clean tech industry’

fastest growing industry in the world

2012: 300 billion dollar (30% growth t.o.v. 2011)

China 60 billion Germany 45 billionAmerica 40 billionItaly 17 billionNetherlands 5 billion

Clean Tech Economy is ‘booming’

Global Energy Transition

not driven by

scarcity, climate, environment

but driven by

geo-political forces, power shifts, prices

The European Energy Transition

is in a lock-in situation

no vision and no strategy

other global world power blocks are pro-active

Europe is not on a route to energy-autonomy

Europe does not have a clear strategy

Germany is the absolute frontrunner in clean energy

influences the energy price in other countries

more and more big power plants are closed

each country has its own energy strategy

Europe is divided

Europe is forced by Russia

to develop an energy strategy

time of easily exploitable resources is over

17 critical earth metals become scarcescandium, neodymium, dysprosium, gadolinium, lanthanum

windmills, electric cars, solar panels, smartphones

expected growth of these metals is > 1000%

China owns 97%

China Resources Strategy

new economy of crucial importance for Europein potency 22 million Europeans involved

in 2013: 2-4% of total employment

in 2020: 5-10% of total employment

Germany and Denmark are frontrunners

Emerging Clean Economy in Europe

3 out of 5 energy companiesdie out in tipping point phase

Survival of the Fittest

not the biggest energy companies survive,

also not the smartest, but the most adaptive

Energy has become too important

to leave to the market only

energy wende is most radical innovation in Europe

rooted in a broad social movement since 1970s

political leadership of crucial importance

substantive polical influence of Green party

consistent innovation policy: feed-in

Germany

4.5% renewable energy production

energy transition plan: 14% renewable energy in 2020

strong fossil energy regime dominated by gas

gas fields empty in 15 years, no plan B yet

in 2030 fossil free is technically possible

Netherlands

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6 ministeriesInvloedrijke personenuit de energiesector

(Ministerie van EZ)

SENTER NOVEM

TRANSITION-PROJECTS

platform-secretaries

TaskforceEnergy Transition

PLATFORMSUSTAINABLEAMEMOBILITY

UKR-support

frontrunnersoffice

PLATFORMGREENRESOURCESFEN

PLATFORMCHAIN-EFFIICENCY

PLATFORMSUSTAINABLEDUURZAMEELEKTRIC.

PLATFORMBUILTENVIRONMENTG

PLATFORMNEW GAS

26 transitionpathways-paden

1long termvisiop visie

600transitionexperiments

PLATFORMGREENHE.SOURCE

IPE Bureaucratic Support

6 Ministries

InterdepartementaleProgram directionEnergy transition

Energy Transition Institutionalised

7 transition platformsthema’s

48% sustainable energy production

32% bioenergy 16% hydropower

30% oil 13% nuclear5% coal

hardly any wind & solar energy production

good sustainable performance but good starting point

Sweden

faces a profound energy transition the coming decades

substitution of nuclear energy from 2020 on

substitution of oil and coal by renewable energy

stimulation of wind- and solar energy

Sweden

has to make crucial choices next 5 years

Sweden

How do transitions work?

Transition fundamental change of structure, culture and practices in societal (sub)system

– structure: physical infrastructure, economic infrastructure (market, consumption, production), institutions (rules, regulations, actors)

– culture: collective set of values, norms, perspectives, paradigms

– practices: routines, behaviour, ways of handling, at the individual level

incumbent structure, culture and practices need to bebroken down and new ones need to be built up

Transition = Power Shift

regime: dominant structure, culture and practices with power and vested interests

niche: emerging, divergent structure, culture and practices at a small scale level

niche wants to develop power and take over incumbent regime regime protects itself against this through absorption, assimilation or elimination of niches

transition = regime-change = power shift

Transition Governance

challenge the market & mobilize society

Transition Governance

long-term thinking & short-term action

Transition Governance

Transition Governance

create innovation spaces for radical innovation

bring together frontrunners in innovation spaces

develop a vision and agenda for radical innovation

start portfolio of transition experiments

Radical Innovation• is disruptive innovation

• is aimed at fundamental, radical change

• is complementary to incremental innovation

• arises from new combinations of businesses

• system innovation = radical innovation

Transition Governance Cycle

vision, pathways,transition agenda

transition arena

transition experiments

evaluation, monitoring learning

Transition Arena- long term- front runners- system innovation- problem / goal seraching

Different Arenas

Political Arena- short / medium term- peloton - incremental changes - problem- and goal oriented

Market Arena- short term- efficiency- profit / growth

Transition Arena

– protected but not closed innovation network

– dynamic learning network

– 10-15 participants, mainly frontrunners

– from society, business, government, science, NGOs

Transition Governance

1st phase searching, learning, experimenting

2nd phase selecting, scaling up

3rd phase implementation in policy process

Organic Steering

vision, action, strategy

demands patience, time, trust

Transition Governance

practised in

European countriesNetherlands, Belgium, France, Scotland, Switzerland, Austria, Finland

Outside Europe Japan, Australia, Canada

Transition Governance

application domains

energy

mobility

food health care city

development

Facilitating Role of Goverment

giving direction

&

providing space

Giving Direction

giving direction

clear and ambitious goals

sound rules of the game

fine-tuning developments in coherence

Providing Space innovation space mental space, juridical space, organisational

space

removing barriers

stimulating odd coalitions

Pro-active Role of Companies

leadership

&

new coalitions

allies between big companies & small / medium enterprises

NGOs as Connectors

frontrunners pave the way

connectors form coalitions

What does it mean for Sweden?

develop a long term vision for biobased economy

formulate a variety of transition pathwaysbiofibers, bioenergy, bio-ICT, bio-built environment, biopharmaceuticals

start portfolio of radical bio-innovation experiments

scale up most successful bio-experiments

Insights• energy transition is in a tipping point phase

• demands governance approach between market & state

• requires vision, strategy and action in one

• demands facilitating role of government

• demands pro-active leading role of companies

Is Sweden ripe for an energy transition governance approach?