New Insights into Socio-technicalTransitions: Green Innovation &

Jacobian Cluster MutationsPhil Cooke, Centre for Advanced

Studies, Cardiff University &Development Studies, Aalborg

University

Aims of the Chapter• In the Climate Change Context to try to

Understand, Critically & Empirically, Socio-technical Regimes & Transitions

• To reconsider Schumpeterian thinking aboutregional innovation and the possibility of‘regional socio-technical regimes’

• To explain important aspects of regionaleconomic growth in terms of convergence or‘recombination’ of firm innovation in ‘relatedvariety’ regional clusters

Two Regime Theories

• Urban regime theory – weaknesses:economistic, poor on agency and change

• Strength – recognizes cities can stimulatemarket ‘niches’ e.g. for renewable energy

• Socio-technical regime – strength: meta-system innovation analysis of post-hydro-carbon ‘niche-regime-landscape’ evolution

• Weaknesses: linear logic, conceptually thin,lack of governance or spatiality dimensions

Combining best elements of both

• Both can recognise importance ofnetworks for lobbying, action, regulatoryand policy change

• Markets can be formed from ‘niches’ butgovernances can be crucial e.g. windturbine subsidy regimes in Denmark &Germany or municipal leaders likeCopenhagen & Dogma project, etc.

1. ‘Closed Loop City’: Kalundborg DKIndustrial Symbiosis Strategy

Kalundborg’s ‘Industrial Symbiosis’& Eco-industrial park

• At the core is Asnaes (coal-fired) power station. Itprovides steam to Statoil refinery & Novo Nordiskpharmaceuticals plants

• In exchange Statoil supplies fuel gas, cooling water andtreated waste water to Asnaes

• Adjacent Gyproc wallboard factory receives fuel gasfrom refinery and scrubber sludge from Asnaes

• Power station ash goes to cement factory• Waste heat from Asnaes & Statoil goes to fish farming

and district heating• Sulphur from refinery > Kemira Acid Plant (fertilizer)• Novo Nordisk> treated sewage sludge to local farms

Niche & Market Impact ofKalundborg’s Industrial Symbiosis

• Statoil refinery saves 1.2 million cubic metres ofwater annually

• Asnaes total water consumption reduced by 60%annually

• 170,000 tonnes of gypsum utilise annually• 97,000 tonnes of solid biomass (NovoGro)• 280,000 tonnes of liquid biomass (NovoGro)• 50-70,000 tons of fly ash• 2,800 tonnes of sulphur…..all utilised locally• All projects environmentally and financially

sustainable (Kalundborg Symbiosis Institute)

Niche & market networking, lobbying &convergence at firm and cluster level

• Grundfos – pumps for e.g. central heating of buildings,including domestic

• 1992 internal research on energy efficient pump – marketniche closed

• 1998 – pump in prototype, extensive Denmark & EUlobbying through Europump – Standards (SAVEProgramme) > Energy Efficiency Index adopted by EU

• 2005 - New classification scheme successfully launchedalongside A-grade Grundfos pumps

• 2007 – A & B standard pumps now dominate market 94% ofmaterial recoverable for recycling. No more high energyconsuming aluminium etc. in product content

• Grundfos Solar and Grundfos Sensor become active inJutland’s Solar Thermal and Wind-turbine clusters withrenewably-powered pump innovations

Clean Tech Biotechnology

Wireless Agro-Food (Organic)

Agro-Food (Conv.) Furniture

Fashion Engineering (Fish)

Engineering (Pipes)

N. Jutland’s Jacobian Clusters

2. Some SV Biofuels Investments• Ausra develops and deploys utility-scale solar technologies in a competitive,

environmentally responsible manner. Palo Alto, CA• Bloom Energy solid oxide regenerative fuel cells (SORFC) - renewable electrical

energy generated from hydrogen and oxygen. Sunnyvale, CA• Miasole Miasole is a low-cost, thin film CIGS solar company. San Jose, CA• Solazyme Uses synthetic biology and genetic engineering for better biofuels

growing algae in fermentation tanks without sunlight, by feeding it sugar.Investors: Chevron, biodiesel maker Imperium Renewables. VC from Blue CrestCapital Finance and The Roda Group. S. SanFran

• Live Fuels Aiming to create green crude to be fed directly through the USrefinery system. The Menlo Park (SV) startup uses open-pond algae bioreactorsand plans to commercialize its technology by 2010. Investors include theQuercus Trust and Sandia National Labs

• Aurora Biofuels:UC Berkeley spinout using genetically modified algae forbiodiesel. Claimed the microbial technology can create biodiesel fuel with yields125 times higher and have 50 percent lower costs than conventional. InvestorsGabriel Venture Partners, Noventi, Oak Investment Partners. Alameda, SF

20 Who Ditched Infotech for CleantechWith their dotcom and broadband-based winnings, serialentrepreneurs of the ICT age have moved into the energy

and cleantech markets• Shai Agassi (SAP), Founder, CEO

Project Better Place, Palo Alto, SV• Bob Metcalfe, Partner, Polaris

Venture Partners, CEO GreenFuel(Camb.MA)

• Vinod Khosla, Founder KhoslaVentures.

• Sunil Paul, Seed investor, earlystage cleantech, Nanosolar, Oorja.

• Elon Musk, Chairman, Tesla,Chairman, CEO SolarCity

• Steve Jurvetson, Partner, DraperFisher Jurvetson.

• Bill Gross, Founder Idealab SteveWestly, Founder The WestlyGroup.

• Dan Whaley, Founder, CEOClimos..

• Martin Eberhard, Founder, formerCEO Tesla.

• Martin Roscheisen, Founder,CEO Nanosolar.

• Martin Tobias, Former CEOImperium Renewables.

• Manny Hernandez, CFOSunPower.

• Jonathan Gay, CEO of GreenBox• Jeff Skoll, Founder Skoll

Foundation, investor in Tesla,Nanosolar.

• Mitch Mandich, CEO RangeFuels.

• Larry Gross, CEO of Edeniq.• Bruce Sohn, President First

Solar.• David Kaplan, Founder V2Green.• David Cope, CEO of PurFresh.

Emergent Cleantech Cluster?

California’s Jacobian Clusters

Cluster Legend:Clean TechBiotechnologyWirelessICTAgro-Food

Organic FoodWineFilm

Click for

Evolution by Mutation in Israel• Pythagoras Solar was founded in 2006 by Gonen Fink, previously at

Check Point Software, The company has an R&D centre in HakfarHayarok, Israel and a US office in San Mateo, California

• Ben-Gurion University of the Negev, a leader in research anddevelopment of technologies in the fields of water, energy and theenvironment, will invest in Israel Cleantech Ventures, Israel’s first cleantechfocused venture capital fund

• Israel Cleantech Ventures was established in 2006 to invest growth capitalin Israel's energy, water and environmental leaders. To date, the Fund hasinvested in 6 companies

• Israel Cleantech Invests in Pythagoras SolarPythagoras is a solar energy company developing innovative photovoltaictechnology to revolutionize the cost of solar electricity.

• Israel Cleantech Invests in AqWiseAqWise develops and implements innovative solutions for biologicalwastewater treatment and rapid filtration using movable plastic biomasscarriers

• Israel Cleantech Invests in Emefcy Bioenergy SystemsEmefcy is designing an innovative wastewater treatment system which willharness the energy inherent in organic components in wastewater

• XJet Solar Energy Entrepreneur from Semiconductors• Orion Solar Energy Entrepreneur from Aerospace

ICTBiotechMedtechCleantech

Israel’sJacobian Clusters

Towards a Schumpeterian Regional Science

Innovation Product Process Organizational Region Input

Radical Computer Pasteurisation On - line Insurance ‘Railroadizatio n’ Laser

Disruptive PC Radiation Budget Airline Trucking Quartz Watch

Recombinant Smart Card SPV Lean Management Biofuels Sensors

Sustain ing HD TV CAD -CAM Customisation Artisan Food Designer Goods

Incremental 3G Cellphone W ind En ergy Call Centres Hybrids 2G Biofuels

Fig. 1 Innovation Intensity & Schumpeterian Category Taxonomy N B. PC : persona l com puter; H D TV : high -definition TV ; 3G : third genera tion; SPV : specia l purpose

vehicle (see text) ; C A D -C am : com puter -aided design/man ufa cturing; 2G : second genera tion

Further towards a Schumpeterian Green RegionalScience

Innovation Pro duct Process Organizational Region Input

Radical Fuel Cells Membrane Carbon Trading Green Solar Paint F iltration Building Codes

Disruptive Low Emission Low Energy Green Organic City LED Street/ Engines Pumps Construction Purchasing Traffic Lights

Recombinant Smart Meters Green Carbon Offsetting Local Sensors

Manufacturing Agenda 21

Sustain ing Photovoltaics Organic Organic Local Food Biocomp osites

Retailing Farms Networks

Incremental W ind Energy 4G Catalysers Biomass CHP Tidal Energy 2G Biofuels

Fig.2 . Innovation Category & Intensity Taxonomy

N B: LED : light -em itting diode ; Loca l A genda 21: neighbourhood or city polic y to m eet K yoto protocols ;

C H P: com bined heat and pow e r plants ; 2G /4G : second/fourth genera tion.

Processum Cluster Initiative,Örnsköldsvik, Sweden

Concluding Remarks• Challenge to understand a neo-Schumpeterian theory of

geographic innovation space• Jacobs highlights ‘related variety’ as a key regional

development driver – also highlights ‘social capital’• Green innovation highlights Convergence and clusters that

rapidly ‘mutate’ - Jacobian clusters e.g. California, N. Jutland(collective entrepreneurship)

• Israel also displays clear ‘green cluster’ mutation from ICTthrough Biotech to Cleantech (‘entrepreneurial events’)

• Norway has Statoil and REC diversifying intra-firm CCS andSolar Silicon agglomerated in north and west

• Jacobian ‘cluster mutation’ originating through entrepreneurshipand its supports seems a powerful explanation of ONE keytype of ‘cluster emergence’…….another type….Örnsköldsvik?

• Örnsköldsvik led by large firms, Kalundborg-style?