Business responses to a sustainability-induced transition
in energy markets: international and regional perspectivesProject
The global transition process towards a more sustainable energy future is one of the key challenges for the 21st century, given that the global dependence on fossil energy sources is associated with a number of negative economic, political, social, and environmental consequences.
This process includes the diffusion of new renewable energy technologies as a sustainable source of energy, developing innovative products and services for more efficient energy use, and rethinking the way energy is used in a number of industries and in metropolitan areas. The role and impact of business in this sustainability-induced transition process is of great importance, given the powerful position of companies in key industries at the heart of this transition process. This includes companies in the energy industries, as well as companies in a number of industries that develop and market energy-related products and services.
The PhD project of Daniel van den Buuse focuses on researching the role of business in this transition process in two interrelated phases: first, the international level, which focuses on the role of leading multinationals in the energy industries in this process; and second, the regional level, in which the contribution of business in sustainable energy usage in urban regions and cities is addressed.
On an international level, the contribution of leading multinationals in the main energy industries (electricity and oil-gas) in the transition process is researched, thereby focusing on their strategies and investments in renewable energy technologies like solar and wind energy. The aim is to analyse to what extent and in what way sustainability is inducing multinationals within the energy industries to develop and commercialize sustainable energy activities, and whether companies are strategically adapting their business activities to contribute to a more sustainable energy future. The business activities of these energy companies have been built up over decades in traditional energy technologies like oil and gas, so renewables present these companies with rather radical innovation. In addition, renewable technologies are generally more expensive to invest in at present, due to early development stage of most renewable technologies, so subsidies provided by government can play an important role in this process. Such factors are important to incorporate in researching the contribution of energy companies in the transition process, which will be done in this first research phase.
On a regional level, urban regions and cities are essential in the transition process towards sustainability: around 75% of world energy demand is concentrated in cities, and this demand will grow further due to increased urbanization. The number of people living in cities was approximately and 50% in 2010, and is expected to increase to approximately 70% in 2050. Combined with expectations of global population figures for 2050 climbing to 9 or 10 billion, establishing sustainable urbanization in these ‘cities of the future’ is essential in this transition process. Business can have an important role here through developing and implementing products and services that contribute to more sustainable energy use in urban regions. Given that these products and services include rather new and innovative technologies, collaboration with other stakeholders from the private and public sector on a regional level is often essential to develop and implement them. Such collaborations can provide an important testing ground for companies which aim to introduce such new sustainability-oriented products and services. In the second research phase, the role of business in these regional-level collaborations to contribute to the process of sustainable urbanization is researched.