Smart Energy Transition

1 Smart Energy Transition Realizing its Potential for Sustainable Growth for Finland s Second Century aalto University School of business , aalto University School of Art and Design, Finnish Environment Institute (Syke), Consumer Society Research Centre, University of Helsinki, Lappeenranta University of Technology, Science Policy Research Unit (SPRU)/Sussex University, VATT Institute for Economic Research, VTT Technical Research Centre, Motiva, City of Lappeenranta, Heureka, FinPro The IEA (2014) has estimated that the global Energy Transition creates a 50 000 billion dollar cumulative market in the next 20 years. The Smart Energy Transition (SET) project tackles the ongoing changes and demonstrates how Finland can benefit from the emerging disruptive technologies around Smart Energy . Disruptive technologies challenge the current Energy system. Improvements in Energy efficiency and the accelerating replacement of fossil fuels with increasingly cheaper renewable Energy change the ways in which Energy is produced, distributed and used in all sectors.

2 For example in the electricity sector, an increasing amount of intermittent production creates the need for new market models, products and services: demand response, storage and flexible production. Breakthroughs in the development of Smart grids, metering, power storage, power-to-gas, power-to-chemicals and the Internet of Things jointly represent a disruptive set of technologies, which include Finland s spearheads of growth: the bioeconomy, cleantech and digitalization. These Smart Energy solutions will cascade into new business ecosystems with unprecedented opportunities for cleantech companies, but also leading to radical shifts in the role of producers, service providers and consumers. The disruption challenges the old rules of the Energy system and shifts industry boundaries. Infrastructures and institutions are slow to change. Yet there are documented tools to successfully manage technological discontinuities and reduce uncertainty by engaging relevant stakeholders in joint analysis, visioning and identification of potential Transition paths, and learning through experimentation and adaptive governance.

3 Using these tools, the disruptive force of Smart Energy can be steered to offer significant possibilities for Finland s spearheads of growth: the bioeconomy, cleantech and digitalization. The SET project adresses the following research questions: 1. What is the speed of the Smart Energy disruption, what are likely to be the most important technologies, and what are its impact on society and its growth spearheads: bioeconomy, cleantech and digitalization? 2. How can different sectors benefit from the disruption, considering a. the institutional framework, compared to other relevant countries, b. emerging business ecosystems in relevant sectors c. competence gaps identified from Smart Energy technology pilots and d. the political and regulatory framework as well as the economic impacts of different solutions? 3. How to best co-create solutions by a. articulating the impacts of the disruption and the opportunities and threats for companies, the public administration, policy makers and consumers b.

4 Testing Transition arenas and engagement formats for user-producer-policy interaction c. integrating the project into relevant policy processes d. interacting with changemakers, stakeholders and the public and e. producing tools for the creation of new business ? The expected impact of the project is increased dynamic resilience and capacity for sustainable growth. The results of the project support the development of new businesses and policy as well as Finnish competence and institutions. Market niches and technology value chains are analyzed to form a comprehensive outlook of the market opportunities for Finnish companies, public and third sector actors. The capacity for experimentation and pilots are enhanced, and the use of research for policy decisions is strengthened. The project consists of six work packages, which are led by Lappeenranta University of Technology (WP1), aalto University School of business (WP2), University of Sussex, Science Policy Research Unit SPRU (WP3), Consumer Society Research Centre, University of Helsinki (WP4), Finnish Environment Institute, Syke (WP5) and aalto University School of Art and Design (WP6): The project is funded by the Academy of Finland, Strategic Research Programme (2015-2017).

5 The project is designed to continue until 2020. Further information: Raimo Lovio, aalto -yliopiston kauppakorkeakoulu: Jero Ahola, Lappeenrannan teknillinen yliopisto, LUT: Armi Temmes, aalto -yliopiston kauppakorkeakoulu: Paula Kivimaa, University of Sussex, SPRU: Eva Heiskanen, Helsingin yliopisto, Kuluttajatutkimuskeskus: Mikael Hilden, Suomen ymp rist keskus, Syke: Sampsa Hyysalo, aalto -yliopiston taiteiden ja suunnittelun korkeakoulu.