Innovation and institutional change: the transition to a sustainable ...

Innovation and institutional change: the transition to a sustainable ... Innovation and institutional change: the transition to a sustainable ...

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Stability and transformation in the electricity system 105 independent project management office, BEOP, was founded. Two basic principles were under research, the Horizontal Axis Turbine (HAT) and the Vertical Axis Turbine (VAT). Fokker, ECN and an engineering company were involved in VAT research. Principal partners in HAT research were the National Aerospace Laboratory (NLR), TU Delft, ECN and Stork. A Dutch wind industry emerged in this period. One of the pioneers in the construction of wind turbines, Henk Lagerwey, started his own company and was affiliated to the TU Eindhoven. More companies emerged during the seventies (Polenco in 1976/7, later renamed Nedwind, Windmaster in 1978) and in the beginning of the eighties. NOW stimulated the development of various prototypes and nine companies were supported actively (Verbong, 1999). Small-scale application of wind energy was mainly driven by possible transfer to developing countries. A wind energy group at the TU Eindhoven was involved in projects as early as 1974, and in collaboration with TNO and RUG, later followed by DHV, UT and LUW (Smulders, 2000) developed consultancy projects and training on wind energy in developing countries, funded by development aid. In overview, early efforts in wind energy were shaped by: – The existence of two coalitions for wind energy: one based on ‘institutional logics’ from the electricity regime and involved in R&D to integrated large scale wind turbines in centralised electricity generation; another coalition, more grassroots oriented, and focussed on small scale development and implementation of wind energy both in the Dutch and developing countries’ setting. These coalitions thus initiated from contrasting perceptions regarding the nature of the problem and solutions, different frames of reference as the grassroots coalition developed from a local needs orientation and the energy coalition from a central station model orientation (see also Grin and Van de Graaf, 1996, for a similar interpretation of the Danish wind case); – The initial belief within the electricity sector that development of large scale wind turbines was the only feasible route for wind energy application in electricity generation; – A focus on the technical aspects of wind energy, amplified by government funding of development of prototypes; – Virtual absence of market driven forces and ‘local’ aspects such as location, planning and permitting. Further experimentation with wind energy In the eighties, the international momentum for wind energy was high. In various countries government support was strong while the wind turbine

106 Chapter 4 industry could deliver reliable wind turbines in the area of 50 to 100 kW. Wind turbine production and application especially boomed in California and Denmark helped by a mix of incentives for producers and users and political support. In comparison, Dutch wind energy developed more slowly. In 1985 9 MW wind capacity was installed in the Netherlands compared to 911 MW in California and 60 MW in Denmark 34 . Based on several sources 35 the following explanatory factors can be identified: – The focus was on large scale development, without establishing trajectories of learning through the development of small scale wind turbines (see also box Sexbierum wind farm); – The complexity of wind turbine technology was underestimated, leading to the installation of wind turbines that were insufficiently tested. In comparison in Denmark a test station for small wind turbines was set up in 1978 while the early pioneer Johannes Juul had started small-scale wind turbine development in the 1950s and his experiences were utilised in the 1970s (Jorgenson and Karnoe, 1995); – While the grassroots coalition largely lost out in expanding an alternative to the institutional logics of the electricity sector coalition in the Netherlands; in comparison in Denmark the bottom-up strategy of the grass-roots coalition was successful from the mid 1970s to mid 1980s in building local decentralised energy systems with strong local involvement (among others through cooperatives at least 160.000 households owned shares in at least one turbine in the mid 1990s according to Jorgensen and Karnoe, 1995: 75). Further developments in Denmark were a slow up scaling of the turbines, a shift from domestic to foreign markets, and the formation of managerial approaches to marketing and exporting of wind turbines. Grin and van de Graaf (1996: 87) illustrate how change in management paradigms co-evolved with the changes in the nature of firms in the wind sector in Denmark. In this process the role of utilities and a more large-scale centralised approach starts to gain the upper hand which also explains the recent focus on offshore wind-farms in Denmark; – The electricity sector was handed a key role in the development of largescale application of wind energy and its connection to the grid, however 34 This is illustrated by the market share of Dutch wind turbines in the main market at the beginning of the nineties, California. Of the 15,856 wind turbines 63 were from Dutch origin (0%) as compared to 6,778 (43%) from Denmark, 660 (4%) from Japan, 283 (2%) from Germany, and 174 (1%) from Belgium (Gipe 1995: 36). The only Dutch company with significant export was Lagerwey, with wind turbines in the 75-80 kW area (Verbong, 1999: 153). 35 Gipe, 1995; Wolsink, 1996; Verbong, 1999; Smulders, 2000; de Keijzer, 2000; Beurskens, 2000.

106 Chapter 4<br />

industry could deliver reliable wind turbines in <strong>the</strong> area of 50 <strong>to</strong> 100 kW.<br />

Wind turbine production <strong>and</strong> application especially boomed in California<br />

<strong>and</strong> Denmark helped by a mix of incentives for producers <strong>and</strong> users <strong>and</strong><br />

political support. In comparison, Dutch wind energy developed more slowly.<br />

In 1985 9 MW wind capacity was installed in <strong>the</strong> Ne<strong>the</strong>rl<strong>and</strong>s compared <strong>to</strong><br />

911 MW in California <strong>and</strong> 60 MW in Denmark 34 . Based on several sources 35<br />

<strong>the</strong> following explana<strong>to</strong>ry fac<strong>to</strong>rs can be identified:<br />

– The focus was on large scale development, without establishing<br />

trajec<strong>to</strong>ries of learning through <strong>the</strong> development of small scale wind<br />

turbines (see also box Sexbierum wind farm);<br />

– The complexity of wind turbine technology was underestimated, leading<br />

<strong>to</strong> <strong>the</strong> installation of wind turbines that were insufficiently tested. In<br />

comparison in Denmark a test station for small wind turbines was set up<br />

in 1978 while <strong>the</strong> early pioneer Johannes Juul had started small-scale<br />

wind turbine development in <strong>the</strong> 1950s <strong>and</strong> his experiences were utilised<br />

in <strong>the</strong> 1970s (Jorgenson <strong>and</strong> Karnoe, 1995);<br />

– While <strong>the</strong> grassroots coalition largely lost out in exp<strong>and</strong>ing an alternative<br />

<strong>to</strong> <strong>the</strong> <strong>institutional</strong> logics of <strong>the</strong> electricity sec<strong>to</strong>r coalition in <strong>the</strong><br />

Ne<strong>the</strong>rl<strong>and</strong>s; in comparison in Denmark <strong>the</strong> bot<strong>to</strong>m-up strategy of <strong>the</strong><br />

grass-roots coalition was successful from <strong>the</strong> mid 1970s <strong>to</strong> mid 1980s in<br />

building local decentralised energy systems with strong local<br />

involvement (among o<strong>the</strong>rs through cooperatives at least 160.000<br />

households owned shares in at least one turbine in <strong>the</strong> mid 1990s<br />

according <strong>to</strong> Jorgensen <strong>and</strong> Karnoe, 1995: 75). Fur<strong>the</strong>r developments in<br />

Denmark were a slow up scaling of <strong>the</strong> turbines, a shift from domestic <strong>to</strong><br />

foreign markets, <strong>and</strong> <strong>the</strong> formation of managerial approaches <strong>to</strong><br />

marketing <strong>and</strong> exporting of wind turbines. Grin <strong>and</strong> van de Graaf (1996:<br />

87) illustrate how <strong>change</strong> in management paradigms co-evolved with <strong>the</strong><br />

<strong>change</strong>s in <strong>the</strong> nature of firms in <strong>the</strong> wind sec<strong>to</strong>r in Denmark. In this<br />

process <strong>the</strong> role of utilities <strong>and</strong> a more large-scale centralised approach<br />

starts <strong>to</strong> gain <strong>the</strong> upper h<strong>and</strong> which also explains <strong>the</strong> recent focus on offshore<br />

wind-farms in Denmark;<br />

– The electricity sec<strong>to</strong>r was h<strong>and</strong>ed a key role in <strong>the</strong> development of largescale<br />

application of wind energy <strong>and</strong> its connection <strong>to</strong> <strong>the</strong> grid, however<br />

34 This is illustrated by <strong>the</strong> market share of Dutch wind turbines in <strong>the</strong> main market at <strong>the</strong><br />

beginning of <strong>the</strong> nineties, California. Of <strong>the</strong> 15,856 wind turbines 63 were from Dutch<br />

origin (0%) as compared <strong>to</strong> 6,778 (43%) from Denmark, 660 (4%) from Japan, 283 (2%)<br />

from Germany, <strong>and</strong> 174 (1%) from Belgium (Gipe 1995: 36). The only Dutch company<br />

with significant export was Lagerwey, with wind turbines in <strong>the</strong> 75-80 kW area (Verbong,<br />

1999: 153).<br />

35 Gipe, 1995; Wolsink, 1996; Verbong, 1999; Smulders, 2000; de Keijzer, 2000; Beurskens,<br />

2000.

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