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

218 Chapter 8
This involved changes in routines of a range of actors, radical organisational
changes within the electricity sector (from supply orientation to client
orientation, and from regional monopolies to market organisation, among
others), and radical policy change within the departments of environmental
and economic affairs (the theme and goal oriented target group policy). It
involved changes in energy management routines in several adopter groups,
ranging from process industries, to horticulture, to health care organisations,
swimming pools, and hotels (and supported by the long term agreements on
energy efficiency in a range of sectors). It also involved the emergence of a
strong set of intermediaries playing a role in creating linkages between a
diverse set of actors and providing information about the potential (relative
advantage) of cogeneration, relating prospective adopters to earlier adopters,
reducing the complexity of the decision to be taken; and playing a role in
convincing potential adopters regarding the feasibility and compatibility of
cogeneration within their existing production and service processes. And it
involved the emergence of a good match between technological and
organisational form (the joint-venture) that distributed risks and benefits and
reduced transaction costs in a way beneficial to collaborating parties. Overall
these change processes benefited from the improved cost conditions through
fundamental changes in the rules applying for remuneration and grid
connection and through continuous policy support schemes.
In overview, we contend that the emergence of decentral cogeneration is the
result of a combination of reduction of legitimacy of existing institutional
logics and the mobilisation of actors, networks, strategies and policies
around an emerging alternative institutional logics. Crucial was the way this
alternative institutional logics was build up outside the dominant actors and
networks of the electricity sector, and initially was mostly a societal
response and mobilisation to the oil and environmental crises. It could gain
force as industrial actors, who challenged the central station orientation of
the electricity sector, were mobilised, enabled by changing conditions
(availability of gas and gas turbine technology), and as government
developed an industrial policy favourable for industrial cogeneration.
Nevertheless, growth was rather slow until the mid-eighties and only started
to pick up when distributors broke the ranks of the prevailing logics in the
electricity sector (triggered by institutional changes) and developed new
client and environment oriented strategies that also fitted well with newly
developed policy approaches. Thus an institutional logics emerged where
rules regarding grid connection and tariffs were adapted in favour of
decentral cogeneration, where policies were developed or intensified to
stimulate cogeneration, and where networks were formed to provide
information and tools regarding integrating cogeneration units in existing
industries and sectors. More traditional approaches might claim that this is a