Achieving energy transitions: Which RES policies are best applied when?
Reducing risk and creating an enabling environment
By: Lena Kitzing and Catherine Mitchell
Submitted to: “ENERGY TRANSITIONS” international conference, UEF Law School, Joensuu, Finland, 3-4 March 2014
The transition to a sustainable energy system is desired by many countries around the world. Financial support for the deployment of renewable energy technologies is the choice of policy in most countries. We argue, drawing from transition theory and the multi-level perspective, that an energy transition evolves in two phases: A first phase with a focus on growth of the niche, in which renewables are protected through support policies; and a second phase with a focus on integrating the niche technologies into the regime, once they have become more mature and the market share has reached a significant level. We show, using policy analysis and socioeconomic considerations including uncertainty, that in the first phase, it is beneficial to focus on establishing support policy instruments which reduce risk for investors (such as feed-in tariffs). This will lead to faster and less costly renewable deployment, and will increase the likelihood of achieving a successful transition into the second phase, where policy focus should be on creating an enabling environment (including e.g. infrastructure, market rules, standards, coordinated support of related niches), in order to embed the new technologies fully into the more and more sustainable regime.
Keywords: energy transition; renewable energy; support policy; innovation systems; enabling environment
Date: February 2014