On the other hand, with investments estimated at several hundreds of billions of dollars within the next few years, the industry offers appealing opportunities to local investors. These recent developments offer a number of appealing opportunities to local entrepreneurs, in a variety of sectors. First and foremost, renewable energy firms and technology manufacturers worldwide offer profitable investment opportunities for both venture capitalists and institutional investors alike. Venture capitalists and business angels will most likely prefer to aim for black swans and radical innovations.
Institutional investors will want to direct their resources towards more traditional technologies such as crystalline silicon manufacturers. Second, similar to what was observed in countries like Germany, this ongoing energy revolution will see the emergence of new services, new competitors, and new business models at the local level. Most of the activities associated with decentralized energy systems are IT-intensive and service-oriented. The energy ecosystem of tomorrow will be composed of small independent producers; it will thus require smart grid operators capable of connecting in a seamlessly manner users and producers and of integrating EV fleets into the electricity network.
It will also need energy service companies capable of providing specialized energy efficiency and integration services to business and households. All these niches offer entry points into the industry and represent options for entrepreneurs. GCC countries are certainly are a fertile ground for such a transformation, and they are well positioned to profit from the opportunities it will create. Entrepreneur Media, Inc. In order to understand how people use our site generally, and to create more valuable experiences for you, we may collect data about your use of this site both directly and through our partners.
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Trust Entrepreneur to help you find out. Get Your Quote Now. Latest on Entrepreneur. I confirm that I am over the age of 16 and consent to the collection of the above data. Entrepreneur members get access to exclusive offers, events and more. Second , we contribute to the theory of technological innovation systems by better understanding the internal dynamics between different functions of an innovation system as well as between the innovation system and its external contextual structures.
Our third contribution is methodological. According to our best knowledge, we are the first to use system dynamics to qualitatively analyze and visualize dynamics between the diverse functions of innovation systems with the aim of enabling a better understanding of complex and iterative system processes. The paper also derives important implications for energy scholars, flywheel practitioners, and policymakers. Energy storage has recently come to the foreground of discussions in the context of the energy transition away from fossil fuels Akinyele and Rayudu, Environmentally-friendlier alternatives exist at least for some applications Akinyele and Rayudu, However, we know little how they develop, what drives or hinders their development, and why they are almost absent from discussions about energy storage.
Against this backdrop, we are empirically analyzing the development of a promising clean short-term storage technology: flywheel energy storage FES. Its operation principle is simple: flywheels store energy in kinetic form in a rotating mass. While low-speed flywheels have been used for years for uninterrupted power system, modern high-speed flywheels HSF promise a range of new applications, including the recovery of automobile braking energy and the stabilization of grid operations in the context of higher penetration of renewable energies.
We use innovation systems theory to shed light on the development of FES. This approach emphasizes the role of non-technical aspects to understand technology development Edquist, , which is seen as complex processes that unfold over time and are influenced by the interaction of a multitude of social, political, institutional, and technological factors Carlsson and Stankiewicz, Positive self-reinforcing dynamics — motors of innovation — need to overcome system weaknesses for TIS growth and maturation Jacobsson and Bergek, The findings reveal that modern FES are emerging with very different dynamics in two different sectors.
First, in the automotive sector FES is developing well as a braking energy recovery technology and is close to introduction in medium-sized markets in mass transportation. Development was driven by two important motors of innovation: the incubation, and in a latter phase the market motor. Second, in the electricity sector FES is developing in various grid-related applications but is currently stagnant because of two important system weaknesses that counteract the demand for storage.
First because of an institutional weakness related with the unclear role FES could play in the transition to a sustainable grid, and second an actor weakness in the form of lacking entrepreneurial and commercial capabilities. We contribute to two different literature. First, we address the cleaner production and sustainable energy technology literature by providing insights into the development of a storage technology that is more environmentally-friendly than conventional batteries and could possibly serve as a substitute in short-term storage applications.
Second, we also contribute to TIS literature. We discuss the determining influence of two contextual structures: industry sectors and competing TIS. And we introduce a new methodological component to the TIS literature by using system dynamics representations to visualize complex TIS dynamics. Finally, we provide strategic insights for practitioners and policymakers.
The research method and the case study are introduced in Chapter 3. Chapter 4 analyses the structural elements and the seven key functions of the innovation system. The analysis is deepened in Chapter 5 using system dynamics to explain how the innovation system develops. Chapter 6 concludes the paper and draws implications for researchers, practitioners, and policymakers.
A schematic overview of the research is provided in Fig. Other promising technologies exist, but, to our knowledge, little is known about how well they are developing. Among these, FES represents an environmentally-friendly option as it is made of non-hazardous basic metals and carbon fibers although some rare earth elements can appear in the motor-generator.
For short-term storage applications FES is a clean substitution technology for batteries Liu and Jiang, Compared to batteries, FES typically have a higher power output watt , but store less energy watt-hours over a short period of time currently only a couple of hours. With several million discharge cycles, FES have a much longer service life and are significantly lighter, have a smaller size, and occupy less floor space Piller, Also, their lifecycle cost is lower than for batteries Zakeri and Syri, In some cases, FES can be complementary to batteries, as an FES is more effective at storing and delivering large amounts of energy watt over a short-time period.
Moreover, when used in combination, they can increase battery lifetime Dhand and Pullen, FES also compete with super-capacitors for very short-term storage application in the seconds to minutes range Doucette and McCulloch, In the literature, three main types of flywheels are distinguished: low-speed, high-speed, and micro-high-speed flywheels.
They have been commercially available for over 30 years and are a conventional solution when low cost is important but floor space is not. They typically rely on an advanced magnetic system to reduce friction. In sum, HSF allow the storage of larger amounts of energy in a smaller space and over a longer time. They were first developed to recover the braking energy of race cars and then buses. They are light, compact, and store relatively little energy, but have a high power output. Compared to their larger counterparts, they are safer but less efficient. Given the bumpy conditions of the road environment in which micro-HSF operate, less advanced but more shock-resistant roller bearings are used, which decreases efficiency, but this is a minor issue as braking energy abounds in vehicles.
Diagram of a high-speed flywheel Schaede, In addition to specialized applications e. First, in the automotive sector, micro-HSF can be used to store recovered braking energy Doucette and McCulloch, and to either provide extra power mainly in race car applications or to decrease fuel consumption. They can be mechanically coupled to the powertrain and thereby also equip conventional vehicles powered by an internal combustion engine ICE see Dhand and Pullen, for a review of mechanical coupling in flywheels.
Second, HSF are intended for stationary applications related to the electricity grid. FES have been developed for several years and are being commercialized — though at different speeds — in several markets. Overall, commercialization and diffusion seem to be below its potential. Extant literature does not provide indications on how the technology developed and why its diffusion is low. Therefore, we empirically analyze how it is developing and diffusing using the TIS approach.
Based on this analytical framework, we discuss its development potential to better understand the role they can play in the energy transition. We only consider LSF when it contributes to the understanding of the development of the flywheel types in focus. They are all rooted in evolutionary economics Nelson and Winter, , but they differ in focus. It is intended to inform policymaking on how to manage, influence, and accelerate technology evolution Foxon and Pearson, Being embedded in a wider socio-technical environment Granovetter, , the innovation system interacts with wider contextual structures Jacobsson and Bergek, , Markard and Truffer, Second, TIS can be related to the structures and dynamics of the sector s of which it is a part.
Third, a TIS is always localized somewhere and, while the analytical focus is on technology, geographical aspects may also be relevant. Fourth, political contexts can play an important role, for instance in the availability of public resources and societal legitimacy. Research shows that these functions need to perform well for TIS build-up, growth, and maturation Hekkert and Negro, These processes can influence each other and form positive or negative feedback loops Jacobsson and Bergek, Conversely, negative self-reinforcing dynamics can also appear when several factors cumulate that prevent the system from growing.
These dynamics are referred to as system weaknesses Jacobsson and Bergek, The FIS framework has been applied to numerous renewable energy technologies and allowed the identification of several common motors of innovation and system weaknesses, which have been used to inform policymaking. Jacobsson and Bergek provide an overview of recent FIS literature and its implications for practice. Investigating both structures actors, networks, institutions and dynamics functions , this study presents a qualitative explanatory case study Yin, using the theoretical lens of TIS for better understanding the strengths and weaknesses as well as the drivers and barriers linked to the diffusion of FES.
The empirical research process is captured in Fig. The first step clarifies the boundaries of the technology innovation system in focus and will be explained in detail in the subsequent section 3.
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Steps 2 to 4 represent the empirical analysis based on the structures, functions, and dynamics of the innovation system as will be presented in section 4. Step 5 shows the aim for using the analysis to derive policy implications see section 6. The case employs multiple units of analysis covering both individual economic actors and industry network-level entities and activities. According to Yin , single case studies can be used not only for further developing emerging theoretical fields but also for in-depth examination of a contemporary topic.
First, we distinguish between a field of knowledge and a product. We view FES as a field of knowledge that is increasingly embodied in a group of artifacts used in mobile and stationary applications. For instance, FES are used in buses, but we do not study the innovation system of public transportation. The second dimension is the breath of the study. Whereas we focus on a narrow technology flywheels as energy storage systems , we adopt a broad perspective when it comes to its applications and consider all applications that promise market development.
We only excluded highly specialized applications such as power boosters in nuclear research facilities e. Indeed, empirical investigations show that TIS actors do seem to be influenced by developments within this geographical space. In line with theoretical sampling criteria Eisenhardt, , the case was chosen for being representative and revelatory Yin, The case is also revelatory because the researchers had in-depth, intimate access to the actors in the TIS and were therefore able to collect rich data about the underlying processes, system dynamics, as well as possible technology applications and related markets.
Following the philosophy of engaged scholarship Van de Ven, , access was partly enabled by trust-building measures in the industry. Central to gaining access was the organization of a major international workshop on the market opportunities of FES, targeting scientists, industry experts, technology developers, system builders, and end-users.
For approximately three years, we also worked closely together with a member of the innovation system, a medium-sized electrical engineering firm. The formal interviews were fully transcribed and data from informal interviews and participatory observation were protocolled according to the methods described in Babbie It guides the researcher in the analysis of innovation systems along six iterative steps: 1 defining the TIS in focus, 2 identifying and analyzing structural components actors, networks, and institutions , 3 mapping the functional patterns, 4 assessing the functionality of the TIS and setting process goals, 5 identifying inducing and blocking mechanisms, and 6 specifying key policy issues.
To deepen our analysis in step 5, we used system dynamics Forrester, , Sterman, to illustrate the relationship between TIS elements, functions, and contextual elements. They are not computational models or algorithms run by computers. They are instead used as representations for explaining and visually communicating complex sociotechnical systems in a simple way Coyle, We built these representations following Sterman and use them for visually communication about the FES technological innovation system.
As explained in the literature review, any TIS can be structured into actors, networks, and institutions. The automotive-related group is composed of fewer but larger firms. The grid-related group is more volatile with many firms having entered and left over the past decades. Firms are rather small and focus primarily on engineering tasks. Some lack marketing experience, while others are subject to financial difficulties.
Actors involved in research, engineering, and manufacturing of FES in the German-speaking technological innovation system non-exhaustive list. Knowledge is exchanged in academic, industry-academic, and user-supplier networks Jacobsson and Bergek, In purely academic networks, four universities are conducting basic research. Third, user-supplier networks are found in the automotive subsystem, for instance in the UK involving FES, powertrain, vehicle manufacturers, and public transport companies. However, industry FES actors are not members of industry associations.
Concerning institutions, there are important differences between the automotive and the electricity sectors. In the first, vehicle-mounted micro-HSF are subject to road and railway regulations, including stringent safety requirements and emission regulations EC, FES has the potential to significantly improve the environmental performance of vehicles, but it is not aligned with the dominant discourses on clean mobility, in which hybrid or battery-powered vehicles are favored see for instance massive investment in battery research, ZSW However, in light of the growing regulatory pressure on emissions, several automotive manufacturers are now interested in FES to complement conventional ICE.
However, there are controversial discussions on the need for storage. While some voices, such as the Berliner energy transition think tank Agora Energiewende Agora, , argue against storage, renewable and storage lobbies strongly favor it BDEW, In the past years, energy markets have been liberalized and power generation, power distribution, and grid balancing were separated Jacobsson and Johnson, , creating a market for storage, the regulatory framework of which is currently being shaped by several powerful industry lobbies. In the automotive sector, knowledge development started decades ago Dhand and Pullen, but dramatically accelerated when the use of kinetic energy recovery systems KERS was allowed in Formula One races in FIA, Leading firms worked in consortia involving multiple technology specialists and customers powertrain and vehicle manufacturers.
Therefore, motorsports worked as a catalyzer for knowledge development. Conversely, in the grid sector, universities played an important role by conducting basic research on the physics, mechanics, and electronics of HSF. However, beyond these networks we observed little knowledge exchange among firms. For example, our triangulation of data from the industry workshop and interviews shows that some actors did not reveal their experiments to other players.
A heavy-duty vehicle manufacturer even positioned itself publicly against micro-HSF, while at the same time being involved with internal testing. Triangulation of our data also shows that incumbents spread false market outlooks, possibly to mislead competitors.
In general, knowledge absorption appears to be slow, particularly for market knowledge. Finally, to a limited extent knowledge is also being diffused to the broader public with a regularly updated website reviewing FES developments Khammas, and a science documentary ZDF, We discuss here only the most important ones. First, against the backdrop of the German energy transition policy and the increasing need for storage, the vision of a sophisticated and clean storage technology is animating many TIS members.
While some were more skeptical, many actors interpret this as a positive signal for the European TIS and believe that the technology is about to gain traction massively. This strong vision is reinforced by strong commercial prospects and good economic appropriability of the technology. However, it should be noted that interviews revealed that other TIS members were more skeptical as they realized that the US grid storage business case is vastly different from the German one and that initial reports by the firm about its profitability were misleading.
Fit between engineering-oriented core competencies and institutional frameworks better than for electric vehicles a. The energy storage landscape is rapidly changing under the influence of a leading substitution technology: lithium-ion batteries. This discourse aims to turn the battery into a synonym for storage, casting a shadow on alternative environmentally-friendlier technologies. This situation can also be observed in the automotive sector where battery-based hybrid or all-electric cars are in the spotlight. The articulation of demand is stronger in the automotive sector, where micro-HSF can be used to reduce fuel consumption especially, as interviews reveal, for large fleet operators and comply with emission regulations for vehicle manufacturers.
Therefore, automotive manufacturers are interested in this technology, as the recent acquisitions of Williams Hybrid Power by GKN, and Flybrid by Torotrak show see Section 4. In the grid sector, demand for storage is not yet well articulated, and there is virtually no demand for clean storage, which would however be the main advantage of micro-HSF over substitution technologies. The influence of regulatory frameworks differs between the automotive and the grid sectors. These regulations may create markets for clean vehicle technologies, including micro-HSF. In the grid industry, controversial discussions about the disputed need for storage see Section 4.
Engineering firms and universities are experimenting along technology and market dimensions. In the market dimension, firms are experimenting with numerous applications in the broad automotive and grid-related fields already introduced. First, motorsports has served crucially as a small nursing market where several manufacturers have developed, refined, and tested micro-HSF. Second, a medium-sized bridging market for buses in metropolitan mass transportation is currently the most advanced market development, with GKN implementing micro-HSF in over buses in London GKN, Other medium-sized markets — though only at a nursing stage — are emerging for heavy and light-duty vehicles, trams, urban trains, and off-highway machinery.
Finally, at least theoretically the largest potential market for micro-HSF is passenger cars. As these three markets offer complementarities in terms of technological requirements and volume, several firms are planning to move progressively into this third market. Market breakthrough for passenger cars strongly depends on original equipment manufacturers adopting the technology, which is a major barrier to be overcome.
For instance, the car manufacturer Volvo decided to abandon the technology even though tests were successful Clancy, Another major market entry barrier is compliance with safety regulations involving very expensive crash tests. Rosseta, Legitimation differs not only between automotive and grid-related sectors, but also within these sectors.
While in the automotive sector, technologies to increase vehicle fuel efficiency are welcomed and social acceptance is high, we find mixed results regarding the micro-HSF itself. In the area of utility vehicles, public transportation operators are among the first companies that gained interest in micro-HSF as they need to mitigate the risk of fuel price volatility.
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Furthermore, flywheels fit the mental frames and mechanical core competencies of the traditional automotive sector. However, we also found serious concerns by a heavy-duty vehicle manufacturer who considered the potential for accidents was too high for micro-HSF and chose to use super-capacitors instead.
However, as their adoption in mass transportation demonstrates, safety is hardly discussed in automotive markets, as micro-HSF passed crash tests and so far no accidents have been reported. In the grid sector, legitimacy is much lower. This can be explained by several important factors.
First, there is currently no specific demand for clean energy storage. Second, when storage is discussed, HSF is absent from discussions dominated by batteries. Third, the emerging regulatory framework for grid balancing is significantly shaped by the battery lobby and is therefore tailored to the specificities of batteries and is unfavorable to HSF. Fifth, FES does not fit the dominant mental frames about storage.
Innovation and Climate Change
Unlike in the automotive sector, actors are less familiar with kinetic storage than with batteries or large infrastructures such as pumped-storage hydropower. These accidents led to public distrust that still persists. Even though low legitimacy is a central issue, only few legitimation activities were observed. FES manufacturers are not even part of a lobby or industry association.
In addition to achieving legitimacy among experts, the technology also needs to gain the trust of the broader public. Unfortunately, this technology seems too specialized to receive media attention, as even more mainstream storage technologies receive little media attention, with the exception of a single German television documentary ZDF, Leading manufacturers in the automotive sector benefited from funding by motorsports.
This extremely short development time shows the important accelerator role that motorsports played. As the demand for micro-HSF had already been articulated, other firms co-developed it with customers who also participated in funding. It is mainly the smaller firms in the electricity grid area that experienced funding difficulties, in particular when it comes to the demonstration projects necessary to showcase their technology. Some of them also experienced difficulties hiring qualified engineers with the interdisciplinary knowledge needed.
Hence, resource mobilization is not only a question of money, but also of competences. In the automotive sector, positive externalities emerged when the technology was adopted by motorsports and several new entrants joined the innovation system. The entrance of new actors brought in important knowledge, competences, and resources strengthening Functions 1 and 6 , resolved uncertainty about technology development F2 , demonstrated its safe use as onboard storage, and overall increased legitimacy F5. In a more recent phase, the positive externalities were further strengthened with the entrance of two large UK automotive players, which further supported technology development, and demonstrated the market potential of micro-HSF F4 , and safety F5.
The situation in quite different in the grid sector, where actor participation in the TIS is more volatile, with many firms entering but also leaving in the past years. We could at the moment of the analysis not observe any positive externalities for existing or new actors. Indeed, uncertainty about the technology and its application is high weakening F2 and F5 , knowledge development and diffusion slow F1 , and advocacy coalitions weak F5. The analysis revealed differences between the functional patterns and dynamics interplay between structural elements, functions, as well as external inducing and blocking mechanisms in the automotive and electricity FES subsystems.
These dynamics and the influence of contextual structures are further analyzed in the next subsections. The figure illustrates how motors of innovation emerge as result of a number of positive interactions between functions — sometimes forming feedback loops — as well as the positive and negative influence of external factors. The first motor, the incubation motor, provided an experimentation space and important funding in the early market formation phase. It was fueled by the presence of motorsports, which allowed the mobilization of financial resources F6 for the development of knowledge F1 and for testing the technology in real-life applications F3.
Furthermore, motorsports acted as a nursing market F4 , which some firms successfully used to develop other markets. Innovation dynamics in the automotive subsystem system dynamics representation based on Sterman, The second motor of innovation, the market motor, was later induced by two external factors. Indeed, engineering firms were already developing micro-HSF when vehicle manufacturers began to search for solutions to comply with emission regulations and when some large fleet operators became interested in reducing volatile fuel expenses.
A market opportunity emerged F4 and some engineering firms successfully positioned micro-HSF as a mid-term solution in the transition to the all-electric car. This market opportunity strengthened the motivation of other actors to support the innovation system F2 , aided market formation F4 , increased legitimacy F5 as customers articulated a demand for the technology, eased access to resources F6 , both through co-development with customers and by means of government subsidies, and eventually strongly contributed to developing positive externalities F7.
The second factor relates to the good institutional fit with the automotive sector and in particular the similar underlying physical and mechanical principles of the flywheel and the ICE technologies. Indeed, flywheels fit the mental frames and the competences of automotive players, who rapidly came to understand their benefits. This proximity made the technology more interesting for new actors to join the TIS F2 and supported its legitimacy F5.
However, hindering factors in the form of market entry barriers and safety issues work against micro-HSF development. First, the vision of the battery-powered electric car as the ultimate clean vehicle dominates discussions on clean mobility. Second, in line with this vision, several leading automakers are working to develop the battery technology, which is the main competitor of micro-HSF.
Third, other less innovative automakers are still pursuing incremental improvements in the ICE and consequently are becoming interested in complementary, mid-term solutions to improve its efficiency, such as micro-HSF. Therefore, while flywheels are becoming established in the mid-term solution niche market, paradoxically, this positioning might well confine it there, making it less suitable to diffuse to mass markets. Fifth, and perhaps most importantly, automotive markets are problematic as they are dominated by a few large firms controlling market access.
Thus, diffusion depends on these firms adopting the technology F5. Finally, safety issues still reduce its legitimacy, which may prevent some actors from adopting it. TIS actors will need to overcome these factors to become established in automotive markets. In the electricity sector subsystem, the dynamic is influenced by one main positive external influence: the political demand and technical need for storage to stabilize the grid for greater penetration by renewable energies see Fig.
Innovation dynamics in the electricity subsystem system dynamics representation based on Sterman, Two important system weaknesses Jacobsson and Bergek, counteract the clear demand for storage and explain the overall stagnation. The first is an institutional weakness caused by two external factors. The first is the unfavorable institutional environment and the little attention that HSF receive.
Indeed, there is simply no demand for environmentally-friendly storage negatively influencing F5 , which is however the main advantage of HSF. As the environmental performance of mainstream storage technologies has escaped scrutiny, actors are guided away from clean storage F2. Consequently, HSF is not seen as creating benefits for other actors F7.
Then, HSF do not fit the mental frames of the incumbents or the public , who expect a battery i. Finally, safety issues, negatively affect FES legitimacy F5. The second external factor relates to market development barriers. The regulatory framework of the emerging storage market is unfavorable to HSF, providing a possible explanation for why there is so far no market for HSF in this sector negatively influencing F4.
Then, there is the fact that batteries represent a very popular and affordable substitution technology, are currently technologically more advanced, and as a result receive a much greater share of subsidies thus also negatively influencing F4. A second system weakness explains that HSF are also not performing well in markets less dependent on this institutional context such as the market for UPS.
This second weakness relates to actors Jacobsson and Bergek, and their poor organizational capabilities. It is fueled by four internal factors see also section 4. First, several actors focus on the engineering and put commercial matters in the background, negatively affecting market-related experimentation F3. Second, partly because of their strong focus on engineering, many actors have only a weak knowledge about possible applications and related markets F4.
Also, they are not organized in an association or in lobbies, which hinders knowledge exchange among them F1 , preventing the collective organization of legitimation activities F5 , and preventing them from organizing effectively as an industry branch in competition with substitution technologies F2. Finally, firms are often small and less professional, which can explain their difficulties to mobilize resources in particular access to public funding F6.
Finally, there is no vibrant community with clear business objectives that would attract new actors F2 or create positive externalities F7. Taken together, these factors create a strong system weakness centered on the negative feedback loop between direction of search F2 , entrepreneurial experimentation F3 and market development F4 but ultimately involving most TIS functions: slow diffusion of knowledge F1 , reduced ability to experiment F3 , to penetrate or develop markets F4 , to advertise and lobby to increase legitimacy F5 , and to mobilize resources F6.
The interaction of the TIS with these external structures is discussed in the following subsections and is illustrated in Fig. The interactions of the focal TIS with the automotive and the electricity sectors interactions I1 and I2 respectively in Fig. Indeed, the sectors are so different that this situation brought the actors of the focal TIS to specialize in the one or the other sector. These differences are located at two levels. First, the two sectors have different technological needs: the automotive sectors a relatively small in watt-hours , compact, and shock-resistant FES whereas the grid needs large in watt-hours and scalable FES with minimum inertial losses to store energy over longer time periods see also Section 2.
These diverging needs imply that actors would need to develop different products for the different sectors and their related markets , which can explain their choice of specialization for the one or the other. Second, the institutional contexts of the two sectors are very different. In the automotive sector, path dependency relates to the use of the ICE as a propulsion system and the related infrastructure, mental frames, and competences. Here, actors appear to meet the need for less emission intense vehicles.
On the other hand, in the electricity sector path dependency relates to the paradigm of the large centralized power generation system. In this sector, actors for instance try to play a role in balancing power markets. In addition to the different technologies needed, promoting the FES in these two sectors involves different strategies. Thus, the strongly differing institutional settings may further explain that actors specialize in one sector, as competing in both sectors would be too resource intensive. Batteries are a more mature technology and represent a substitution technology Norton and Bass, to FES.
Therefore, in most applications, batteries and FES compete for the same function of short-term storage. Both TIS also compete for attention in public and political discussions about storage, but batteries are currently leading the technological competition Eggers, , and are therefore not threatened by developments in the FES innovation system. The two TIS are coupled in the grid sector in shaping the emerging regulatory framework on grid storage.
It supports the electricity subsystem of the focal TIS by advancing political and public discussions on grid storage, which also increases the legitimacy of FES. Finally, batteries create funding opportunities for storage in general, which FES may benefit as well. In the automotive subsystem, competition with batteries is also strong, primarily because batteries shape the vision of the ultimate clean car, one that is battery-powered.
However, to some extent batteries also support micro-HSF by creating this clean car vision. Indeed, some manufacturers have become interested in less radical clean vehicle solutions and are searching for a mid-term solution. This creates a market in which some micro-HSF manufacturers are positioning themselves.
Our qualitative case study results draw attention to non-technological factors related to the development of clean storage technologies, in particular the importance of institutional fit with the targeted industry sectors. Moreover, the case provides insights into the reasons why this clean technology is almost completely ignored, amongst others for political and national competitiveness reasons in the context of large scale efforts to develop the battery as a core technology in the German energy transition.
The next sections discuss the implications for researchers, practitioners, and policymakers. Our research contributes to TIS literature in two ways: first, we innovate in the way TIS dynamics can be communicated and, second, we contribute to the current discussion on contextual structures. First, we use system dynamics representation Sterman, to illustrate TIS dynamics.
In our view, a weakness in the TIS literature lies in the lack of visual tools to communicate the dynamics within the TIS — specifically, between system functions and contextual elements. To keep the illustrations simple, we decided to represent only the most important relationships. Consensus about which relationships to represent was based on an iterative dialogue process between the two co-authors, knowledgeable colleagues, and feedback obtained at conferences. The second contribution relates to the recent critique that TIS analysis is too focused on internal processes and dynamics Jacobsson and Bergek, , Markard and Truffer, , thus neglecting contextual elements, which are merely treated as external factors, with the risk that influential processes external to the focal TIS are not fully captured.
Our case shows the role two of these structures plays sectors and competing TIS and contributes to better understanding their influence on the focal TIS. We argue that a typical bottleneck at this stage is that entrepreneurial experimentation is too weak in relation with the many possible future markets in which the technology could be established. To overcome this bottleneck, TIS actors may benefit from focusing their activities on one industry sector — the one with the best institutional fit — in order to avoid their efforts being fragmented in the pursuit of too many uncertain directions.
Therefore, the emergence of specialized subsystems may be the result of actors specializing on one sector when the TIS is closely coupled with several. We show that supportive and symbiotic relationships, which have been less well researched, can play an important role as well, for example when the competing TIS helps bring the storage topic into political discussions. In fewer cases, symbiotic interactions were observed as well, for example when the focal technology complements the competing one. Our case study thus provides evidence for the importance of these two contextual structures to understand TIS development.
Future research should further examine the influence of contextual structures on the direction of TIS development, particularly the role that coupling with multiple sectors plays on the direction of search of TIS at the formative stage. In this context, the role of actor strategies should also be further investigated, both of incumbents who may support or resist TIS development and how TIS members react to this. Another avenue for future research is to examine how competing TIS at different stages of maturity such as batteries and flywheels co-evolve and influence each other in the energy transition.
Understanding how they interact — in ways other than competition — could help further improve innovation support policies, particularly to avoid lock-in situations of rapidly emerging but suboptimal technologies. This research demonstrates the importance of non-technical aspects in technology development, as FES development was shown to be very different in the automotive and the grid-related sectors.
Given that the electricity grid subsystem is developing less well, we also provide insights for practitioners working in this context. First, our findings show that individual actors likely have only a limited influence on the current institutional development as powerful lobbies are shaping the future regulation of grid storage. Practitioners would benefit from developing applications less dependent on electricity grid regulations, such as in the growing global market for UPS or for island grid stabilization, where regulatory pressure is lower as is pressure on prices.
The innovation system is composed of many smaller actors that share similar commercial objectives. They could benefit from joining forces in some areas while remaining in competition in others. For instance, forming professional networks could improve the image of this nascent industry, contribute to increase its legitimacy and visibility, and thereby possibly attract new actors.
Sustainable energy for developing countries
Further, partnerships with larger industrial groups could ease access to financial resources and to various competences such as marketing. Beyond suggesting practitioners to reduce their actor weaknesses, this research also shows that TIS dynamics significantly influence innovation practices at firm level Pohl and Yarime, Hence firms benefit of adjusting their internal innovation management to the specific TIS context and, particularly in pre-competitive stages, coordinating it with other actors. The most alarming finding for policy makers is that environmental criteria for storage technologies have hardly been considered to date in the context of the energy transition.
The rapid diffusion of hazardous batteries might create important rebound effects, at the latest when they need to be disposed of. Therefore, policymakers are strongly advised to consider the environmental impact not only of energy generation but also of storage technologies. Policy support for storage has so far been technology neutral, which is a minimum condition for FES development but not sufficient, according to Jacobsson and Bergek The flywheel case shows that technology-specific support is also needed.
Indeed, the policy framework is being successfully shaped by the leading technology battery actors. In the early development phases, competition is more about actor expectations and political power than about technological performance Alkemade and Suurs, , with the risk of being locked-in into a suboptimal technology that prevents better technologies from diffusing. Therefore, less well organized TIS are disadvantaged, unless a technology-specific support for a range of alternative technologies is provided.
The most important limitation of this paper relates to the delineation of the innovation system boundary. The analysis would benefit from a more systematic study of the processes and dynamics taking place a in the two industry sectors the flywheel TIS plays a role in, b in the competing battery TIS, and c in the US-based FES innovation system.
Another limitation is the use of system dynamics representations to communicate TIS dynamics. The paper shows that FES is almost a fully mature technology that is being commercialized — though at different speeds — in several markets. Through its low environmental impact and high efficiency, FES could play a beneficial role for the energy transition in many short-term storage applications. However, its diffusion is below its potential. The findings of the qualitative case study explain this situation and reveal how modern FES are emerging in the automotive and the electricity grid sectors.
In the automotive sector, micro-HSF is developing well as a braking energy recovery technology and is close to introduction in mass transportation markets. Development was fueled by two motors of innovation. First motorsports provided an important technology and market incubation space. Second, development was favored by market demand and a good institutional fit with the automotive industry.
Further development is uncertain because it strongly depends on technology adoption by major incumbents. In the electricity sector, HSF is developing in various markets but stagnating at the stage of demonstration projects because of two system weaknesses. The first, an institutional weakness, relates to the absence of a clear role for HSF in the energy transition. HSF does not fit dominant mental frames about storage, and the emerging markets are strongly shaped by more popular substitution technologies batteries.
The second is an actor weakness that relates to their weak organizational capabilities. Many actors lack a clear market perspective and are weakly organized, which prevents them to establish as an industry. Finally, we thank Hendrik Schaede for his helpful input of technical aspects of the flywheel technology.
National Center for Biotechnology Information , U. Sponsored Document from. J Clean Prod. Hansen b. Erik G.
Improving the Efficiency of R&D and the Market Diffusion of Energy Technologies
Author information Article notes Copyright and License information Disclaimer. Samuel Wicki: ed. Hansen: ta. Abstract The emergence and diffusion of green and sustainable technologies is full of obstacles and has therefore become an important area of research. Keywords: Technology innovation system, Functions of innovation systems, Green technology, Sustainable energy, Flywheel energy storage, Short-term storage, Batteries, Kinetic energy recovery system.
Introduction Energy storage has recently come to the foreground of discussions in the context of the energy transition away from fossil fuels Akinyele and Rayudu, Open in a separate window. Literature review 2. Structural elements Description Actors Actors and their competences shape the development of a technology. They can be part of a value chain when the system becomes commercially organized , or they can be policy actors, researchers, funding organizations, etc.
Networks Networks emerge when actors organize themselves to achieve common goals. Networks are seen as important ways to exchange knowledge and transfer technology. Networks have different purposes and include developing academic knowledge and transferring technology between academia and industry, as well as collaboration among industry actors consortia and between users and suppliers Jacobsson and Bergek, Institutions Institutions form the regulatory and socio-cultural contexts in which a technology is embedded. They cover elements such as the laws and regulations that govern the innovation system.
But institutions can also include less tangible elements such a culture, mental frames or cognitive representations Tripsas and Gavetti, , dominant world views, and typical ways of thinking about a problem e. Technology Technology is understood as a field of knowledge, typically centered on one primary knowledge area, but also composed of complementary areas needed for its functioning.