Transcript Innovation policy for the environment

Perfecting innovation policy
The example of the Netherlands
René Kemp
Presentation at opening of CIRUS
April 18, 2007
UNU-MERIT, ICIS, DRIFT
Innovation is many things
Innovation is created in distributed
systems of knowledge and its success
depends on economic frame conditions
and many other factors not under the
control of the innovator
Rationale for innovation policy:
market failure
private markets provide too little incentive
for innovation because of knowledge
spillovers (danger of imitation)
This is the traditional economic argument
which is used by policy makers
It is not wrong but as a guide to policy it is
poor
System failure as a rationale for
innovation policy
Infrastructure problems regarding the physical
infrastructure (transport, etc), the scientific infrastructure
(high-quality universities and research labs, technical
institutes, etc) and the network infrastructure (IT, telecom).
Transition problems: difficulties that arise when firms and
other actors encounter technological problems or face changes
in the prevailing technological paradigms that exceed their
current capabilities.
Lock-in problems derived from the socio-technological
inertia
Hard and soft institutional problems linked to formal rules
(regulations, laws) as well as more informal and tacit ones
(social and political culture for instance).
Source: Smith (2000)
System failures refer to inappropriate infrastructure of
knowledge, poor capabilities to adapt, institutional
barriers and lock-in
Here it is not so much the divergence between private
benefits and social benefits but the (national)
innovation system itself that is a hindering factor
The innovation system comprises many things: the
infrastructure of knowledge and access thereto, the
knowledge transfers taking place, the platforms and
networks for interaction, and the regulations and
customs that inhibit (environmental) innovation
Source: OECD (1998)
Because of the many factors keeping
back innovation
Countries have multiple policies for innovation:
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Support of R&D
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Knowledge transfer
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Investment support
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Green taxes
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Science and technology programmes
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Skills and educational policies
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Competition policy
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Regulations for the uptake of clean technologies
Government policy for sustainable innovation
in the Netherlands
Courtesy of Geert van der Veen
There has been a shift towards more
integrated approaches
Which combine push and pull
having a long-term focus
Involving platforms of interaction
Bringing together different knowledge holders
With government as a facilitator (asking the
platforms to define programmes and offer
suggestions to policy)
Integrated approaches
Courtesy of Geert van der Veen
DTO-programme (Sustainable Technology
Development) in the NL
Scope: 2040
Factor 8-thinking
Approach towards either functions in society
(living, food, transport) or sectors (chemical
sector)
Backcasting
Stake holder involvement in idea generation
Technological focus
Courtesy of Geert van der Veen
The Dutch transition approach
a journey to the south
Transition management
… is a deliberate effort to work towards a transition in a flexible,
stepwise manner, utilising dynamics and multiple visions
… involves a wide range of policies with their choice and timing
gauged to the particular circumstances of a transition
Top-down elements
26 Transition paths
6 Platforms
new gas
sustainable mobility
green resources
chain efficiency
Sustainable electricity
Sustainable building
Interdepartmental programme directorate
energy transition (IPE) and Taskforce
The journey to the south
Led by the Ministry of Economic Affairs
Goal: to achieve a transition to a low-carbon
economy in 40-50 years time
In a bottom-up, top-down manner, using
adaptive programmes (portfolio approach)
With an important role for special platforms
Government-business partnership
Bottom-up elements
Business alliances
Experiments by business with real users
Identification of barriers and synergies
informing private action and policy (using
a desk for policy complaints)
Selected transition paths
Platform for “green resources”
One of official 6 platforms
5 transition paths for green resources
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Biomass production in NL
Biomass import chains
Coproduction of chemicals (C1-6),
transport fuels, electricity and heat
SNG
Green chemistry
60 million euro for biofuels
In 2007 2% blending requirement for
gasoline and diesel (fiscal support in 2006)
Certification system for sustainable biofuels
Goal: substitution of 30% of fossil fuels by
2030
Why is NL interested in
biomass?
 Because NL is a gas country
 Because agriculture business and
the logistic sector (Rotterdam
harbour) are interested in it
 Because the chemical industry
thinks it may obtain an
competitive edge from
knowledge-intensive, green
materials
 Because ECN is a world leader in
biomass gassification
Instruments for use
Revolving fund of risk capital (from institutional
investors)
Support for transition coalitions and experiments (35
mln euro)
Subsidies for energy transition technologies (added
to lists of technologies eligible for fiscal support)
Temporary support for eco-products
Innovation waivers: temporary relief from permits
Energy service companies offering advice to
companies and households
TM: not an instrument but a new
framework for policy, in which
Research and innovation policies are oriented
towards transition goals and transition paths
Different coalitions are formed of private-public
actors and NGOs
Regulatory relief is offered
Special desk is created for frontrunners
(koplopersloket) to hear about problems and needs
In which Director-generals from 6 ministries meet to
discuss energy transition issues
Special attention is given to outsiders offering
innovative solutions (new business goal)
Role for science
Invention
Foresight analysis together with business
Sustainability assessment of alternative
systems
Study of past transitions
Evaluate transition policies and transition
experiments
Government-science interactions
Big research programme about system innovation
and transitions with about 100 researchers
(www.ksinetwork.org)
Involvement of scientists in sustainable mobility
programme where project managers to answer
“transition questions”
Discussions between policymakers and scientists
Transition management as
Perspektivischer Inkrementalismus
Using multiple visions (because visions
create better world together rather than
apart)
Reliance upon experimental learning
Adaptive portfolios: each option has to
prove its worth
Policy as a facilitator of change (with
government as partner of business)
Why we need transition
management
1) Because of the barriers to system innovation --
which have to with uncertainty, the need for change at
various levels and vested interests
2) Because public policy is highly fragmented and
oriented towards short term goals
3) Because of the need for societal support for
transition policies and for legitimising policies
towards structural change
4) Because a gradual approach of small steps is
economically not disruptive and politically and
socially do-able
Transition management
Something for Switzerland?