Title: Supplier strategies and responses to institutional drivers for an emerging energy technology

Authors: Neil Strachan, Hadi Dowlatabadi

Addresses: Pew Center on Global Climate Change, 2101 Wilson Blvd., Suite 550, Arlington, VA 22201, USA. ' Sustainable Development Research Initiative (SDRI), The University of British Columbia, Room 216, 1924 West Mall, Vancouver, BC V6T 1Z2, Canada

Abstract: This paper investigates the role of suppliers of a new energy technology, when the market for that technology continues to be in a state of flux, and is characterised by continued regulatory and institutional developments. This paper first summarises the institutional drivers resulting in the widely divergent diffusion of distributed generation (DG) based on natural gas engines in the Netherlands and the UK. Then, supplier responses to this institutionally driven market are discussed. Under regulatory support, supply firms were able to implement innovative operational and ownership arrangements, hugely growing the market while positioning themselves for new R&D and market developments. Under regulatory restrictions, supply firms fought to survive, with resultant implications for the reputation and longer term prospects for this new energy technology. The paper concludes by discussing how continuing institutional instability can limit the supplier strategies based on spillovers from successful regulatory experiments. Thus, the establishment of a viable energy supply industry is delayed under continuing regulatory uncertainty.

Keywords: diffusion; energy supplier strategies; regulatory drivers; institutions; distributed generation; new energy technology; natural gas engines; The Netherlands; UK.

DOI: 10.1504/IJGEI.2004.005828

International Journal of Global Energy Issues, 2004 Vol.21 No.4, pp.383 - 396

Published online: 09 Dec 2004 *

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