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

Stability and transformation in the electricity system 121
– Conditions and developments in other regimes (waste regime,
agricultural regime) play a significant role in the development of biomass
as an option for electricity generation;
– The agenda and expectations for use of bio-fuels for the transport sector
are increasing, also due to EU guidelines and this increases competition
between biomass utilisation in the power and transport sector.
In overview, biomass is a very diverse and fragmented source for electricity
generation. There is fierce competition for R&D budgets between
conversion routes that are not yet commercial. For commercial routes,
especially combustion and co-combustion, there is also strong competition
for biomass sources, such as for waste-wood. For example, the energy
distribution company Essent acquired first mover advantage in its
development of the Cuijk biomass-fired power plant for which it agreed on
contracts with for example Staatsbosbeer, for wood prunings, and with
sawmills for wood remains (Hofman, 2005). The company Electrabel
announced in 2001 that it had bought all olive residuals from Tunisia as a
potential product for co-combustion but this can only serve some percentage
points of its total biomass demand (Penninks, 2001). In 2003 and 2004
imports of biomass grew rapidly, mainly agro-residues, palm oil, olive
residues, palm kernel, etc., and it was estimated that around 50% of cocombustion
took place with imported biomass, with several power plants
importing all biomass for co-combustion (Junginger and Faaij, 2005: 16, 20).
This is illustrative for the way the logistics and availability of biomass is
given shape in an international setting and demands altogether new linkages
and networks, but also points at major uncertainties regarding the way a
biomass market may unfold. One of the uncertainties is the way appropriate
institutional arrangements can evolve to safeguard the sustainability aspects
of biomass crop production and international biomass trade and its effects on
land use and agricultural crop production. Some studies have suggested that
local production and use of biomass for power and/or transport may provide
positive effects to local economies relative to imports of fossil fuels (Van
den Broek, 2000). Institutional frameworks need to ensure that income is not
mainly appropriated by elites and that local food production or tropical forest
areas are not threatened. For example, Essent has been involved in the
development of a certification scheme to ensure that imported biomass for
co-combustion can be traced, and to ensure that certain sustainability
principles are being followed by suppliers (Junginger and Faaij, 2005: 23).
Also a taskforce on sustainable bio-energy trade at the International Energy
Agency has been set up to specifically to develop and disseminate
information and knowledge for the creation of sustainable bio-energy
markets.