ABSTRACT
This paper addresses the role of incumbent firms in driving transitions that entail multiple sectors, conditioned by multiple regimes. We analyse the case ‘HYBRIT’, a radical innovation venture championed by three incumbents from the steel and energy regimes. We investigate what conditions the incumbents’ agency and how they enacted their agency targeting restructuring of the regime elements – actors, institutions, and materiality. We find that eight endogenous and exogenous factors coincide and condition the incumbents’ agency, from which they act in a novel direction of change. We contribute by showing how the collaboration within and across regimes enabled the accomplishment of actions that would have been challenging for individual incumbents to achieve alone. In this setting of scale-intensive industries, incumbents have characteristics that give them a significantly larger capacity to stimulate change than newcomers. The timing and combination of endogenous and exogenous factors, enabling incumbents to collectively drive a transition.
Acknowledgements
The authors are grateful for constructive comments on earlier drafts received from two anonymous reviewers, Jerker Moodysson, Anna Bergek, and at the EU-SPRI conference 2020. The authors wish to express their gratitude to all interviewees that have participated in the data collection phases. Interviews in phase one were conducted in a project funded by Swedish Energy Agency. The writing of the paper was funded in part by Vinnova through the STIPP project [grant no: 2017-01600] and the Swedish Energy Agency [grant no: P2021-00360].
Disclosure statement
No potential conflict of interest was reported by the author(s).
Author contribution statement
Kersti Karltorp: Data collection (interviews in the first and second phase), conceptualisation, analysis, writing, review & editing.
Shanyun Sam Lu: Data collection (media coverage and interviews in the second phase) conceptualisation, analysis, writing, visualisation.
Eugenia Perez Vico: Conceptualisation, writing, review & editing.
Notes
1 In this paper we refer to incumbent organisations as incumbents.
2 Steel can be produced from scrap or virgin iron ore. Steel produced from scrap has substantially lower greenhouse gas emissions than steel produced from iron ore.
3 Other options for emission reduction for steel made from iron or, including carbon capture and storage, could only reduce 80% of the emissions (Quader et al. Citation2016).
4 SSAB refers to demand for steel produced from iron ore with low emissions. Steel produced from scrap with low emissions is already available on the market.
5 This intermediate product is called sponge iron or direct reduction iron.
6 The ‘state-aid rules’ stipulated by the EU Commission set ceiling amounts of national government support granted to firms for the sake of preventing unfair competition.
7 ‘IPCEI’ stands for ‘Important Project for Common European Interest’ and allows national governments to grant funding exceeding the maximum amount stipulated by the state-aid rules’, provided the initiative in question is approved by both the national government and the EU Commission and that the innovation and operation involve a minimum of two EU states.