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

2 Chapter 1
systems of production and consumption away from its carbon base; another
element is that it demands alternative forms of governance stretching from
the local to the global.
Shaping of both elements as a response to the climate change challenge has
been taking place for some two decades now but results in terms of reduction
of greenhouse gases and realisation of effective modes of governance are
disappointing 4 . Some reduction in carbon intensity may be observed, mainly
because of a shift from coal to gas and increasing energy efficiency, but
these tend to be offset by increasing energy consumption triggered by rising
mobility and new electricity consuming ICT applications, among others.
Successes in switching to alternative energy and transport systems are
incidental, isolated and emerge too slow to make a real impact in expanding
economies. For global governance, ratification and entry into force of the
Kyoto Protocol in 2005 may be considered a relative success that is seriously
diminished by the withdrawal to the climate treaty of the USA, the major
contributing developed country, and Australia. Despite potential free-riders,
the European Union and individual countries such as the Netherlands,
remain committed to the Kyoto Protocol and the climate policy process. The
results in the Netherlands have been poor however. CO2 emissions increased
with 12% from 1990 to 2003 (RIVM, 2005a: xxi). Increases in the energy
and transport sector have been especially rapid with 36% and 26%
respectively, while the industry sector realised a reduction in CO2 emissions
of 12% from 1990 to 2003 (RIVM, 2005a: xxi). Due to a drop in CH4
emissions, N2O emissions, and F emissions (HFCs, PFCs) overall
greenhouse gases increased by 1.5% in the period 1990-2003, well off the
target of a reduction of 6% of greenhouse gas emission in 2008-2012 relative
to 1990 (RIVM, 2005a: xi, 1-3). Nevertheless, it is expected that with a
stabilisation of greenhouse gas emissions in the Netherlands for the
reference period, the Kyoto target can be realised with emission reduction
realised outside the Netherlands (RIVM, 2005b: 13).
These data illustrate typical characteristics of the response to the climate
change challenge. A first element is that the restructuring until now has
mainly taken place by eco-efficiency strategies of industries, mostly through
incremental innovations that optimise existing industrial production, and that
the underlying carbon base has not really changed. A second element is that
the formation and negotiation of a global institutional arrangement for the
climate problem takes place through a sequence of small steps (Hasselmann,
et al. 2003). The focus has foremost been on realising initial short-term
reduction targets, implying that the interim targets of the Kyoto Protocol
4 See for example Van Ierland et al. (2003) for an overview of main issues, complexities,
controversies and implementation aspects in international climate policy.