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Handbook of Research on Energy Entrepreneurship

Handbook of Research on Energy Entrepreneurship

Elgar original reference

Edited by Rolf Wüstenhagen and Robert Wuebker

This timely Handbook provides an excellent overview of our knowledge on the drivers, influencing factors and outcomes of energy entrepreneurship. As the world grapples with global resource crunches and fights to reap the rewards of new energy technologies, a wide space for entrepreneurial opportunity has emerged. The Handbook of Research on Energy Entrepreneurship offers critical insight on how nations the world over can make full use of those opportunities.

Chapter 15: Path Dependence, Path Creation and Creative Destruction in the Evolution of Energy Systems

Raimo Lovio, Per Mickwitz and Eva Heiskanen

Subjects: business and management, entrepreneurship, organisational innovation, innovation and technology, organisational innovation, technology and ict


Raimo Lovio, Per Mickwitz and Eva Heiskanen* 1 INTRODUCTION Why is it difficult to reorganize our energy system fundamentally, even though the need is today evident to almost everyone? The three combined challenges that most societies face with regard to their energy systems are: sustainability, climate change in particular, security of energy supply and competitiveness. For Europe these goals are addressed in the ‘20 20 by 2020’ initiative (COM 2008/30), but also in the Second Strategic Energy Review (COM 2008/781): reducing greenhouse gas emissions by 20 per cent, increasing the share of renewable energy to 20 per cent and improving energy efficiency by 20 per cent, all by 2020. We address the challenge of reorganizing energy systems by examining the role of path dependence, path creation and creative destruction in the evolution of energy systems. These concepts set the stage for examining the role of different innovation mechanisms and actors – such as new entrepreneurial and incumbent large firms, policy-induced innovations and civic or consumer activism – in the transformation of energy systems. Path dependence is a popular concept in evolutionary economics (David, 1985; Arthur, 1989), but it is also used in anthropology, history and management (Hirsch and Gillespie, 2001), and increasingly also in political science (Pierson, 2004). As it has become more widespread, the use of the concept has widened. In a broad sense, path dependence refers to the fact that ‘history matters’: prior choices place limits on what can be done today. This is because a certain technology becomes dominant...

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