Unpacking resource mobilisation by incumbents for biorefineries: the role of micro-level factors for technological innovation system weaknesses

ABSTRACT

This paper unpacks resource mobilisation for biorefineries by studying investment decisions of incumbent pulp and paper firms in Sweden and Finland. The analysis highlights that the limited adoption of biorefinery technologies can be attributed to both insufficient abilities (lack of needed competencies and partnerships) and interests (preference for improving existing technologies) by pulp and paper incumbents. Drawing on the technological innovation system perspective complemented with insights from the management literature on the role of incumbents in technological change, four issues are empirically identified as important for improving resource mobilisation for biorefinery technologies: establishing loosely coupled divisions in pulp and paper firms; creating internal markets for new bioproducts aimed at further technological development; entering purchasing agreements with downstream actors; and investing in new managerial competencies.

KEYWORDS:

• Biorefineries
• technological innovation system
• pulp and paper industry
• incumbents

Acknowledgements

This paper benefitted from very insightful comments from two anonymous reviewers and Kirby Calvert, the guest editor of this special issue. The authors would further like to thank Fredric Bauer, Christian Binz, Hans Hellsmark, Staffan Jacobsson, Antje Klitkou and Bernhard Truffer for helpful comments. Finally, the authors thank the participants in the interviews for their time.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Teis Hansen is associate senior lecturer at the Department of Human Geography and also affiliated to CIRCLE (the Centre for Innovation, Research and Competence in the Learning Economy), both institutions at Lund University. In addition, he is senior researcher at NIFU, the Nordic Institute for Studies in Innovation, Research and Education. Teis’ research focuses on the intersection between economic geography and innovation studies. Current research topics are spatial aspects of innovation processes for sustainability transitions, as well as technology transfer from developed to emerging economies within the field of renewable energy. Additionally, Teis also works on proximity and innovation, the development of low-tech industries, innovation in cross-border regions and Smart Specialisation Strategies. Teis earned his Ph.D. in economic geography from the University of Copenhagen in 2012.

Lars Coenen is professor at CIRCLE (the Centre for Innovation, Research and Competence in the Learning Economy), Lund University and (part-time) research professor at NIFU, the Nordic Institute for Studies in Innovation, Research and Education in Oslo. His research interests cover the geography of innovation and sustainability transitions. He draws on and seeks to contribute to theories in the areas of innovation systems, the multi-level perspective on socio-technical transitions and evolutionary economic geography. Empirical projects address regional development, clean-tech industries and the bio-based economy. Originally from the Netherlands, Lars has been enjoying life and work in Sweden since 2002.

ORCID

Teis Hansen http://orcid.org/0000-0001-9383-3471

Lars Coenen http://orcid.org/0000-0002-5671-3988

Notes

1. A recent contribution underlines that the functioning of a TIS is also significantly affected by its context (Bergek et al. 2015).

2. For a discussion of these papers and their respective differences, see Markard and Truffer (2008b).

3. We draw on the set of functions suggested in Bergek et al. (2008) excluding the development of positive externalities. In our view, the build-up of externalities is a generic function of innovation systems that could relate to knowledge diffusion as well as legitimacy (see also Binz, Truffer, and Coenen 2016).

4. The TIS approach has been developed on the basis of a micro-level understanding of firm behaviour rooted in evolutionary economics, industrial dynamics and the resource-based view of the firm (Carlsson and Stankiewicz 1991). At the same time, micro–meso couplings in TIS need greater attention, see recent calls by Farla et al. (2012) and Markard and Truffer (2008b).

5. New technology components may refer to both new processes, tools, machineries and the associated skills.

6. To exemplify, the recent Metsä investment in Äänekoski amounts to €1.2 billion (Metsä 2015).

Additional information

Funding

This research was funded by the Swedish Energy Agency and the Swedish Knowledge Centre for Renewable Transportation Fuels through the project Enabling the transition to a bio-economy: innovation system dynamics and policy under [grant number 39112-1], by Nordic Energy Research through the project Technology Opportunities in Nordic Energy System Transitions under [grant number RD 2011-42], by the Swedish Energy Agency through the project Green transition and co-evolution of industry and the energy system, by VINNOVA under [grant number 2010-07370], and by the Swedish Foundation for Strategic Environmental Research (MISTRA) through the project Sustainable Plastics and Transition Pathways, by Vetenskapsrådet under [grant number 349200680].