Legacy systems – opportunity or barrier to change?
Each of the energy supply chains are real systems that represent enormous investments in energy installations and infrastructure, in industrial sectors and companies that supply and develop energy technology, and institutions to develop know-how and educate energy professionals.
For example, in temperate climate zones, homes need to be heated during winter. Over time, a variety of systems have developed for this: use of oil-heaters in the US, natural gas infrastructure supplying gas for central heating systems in the Netherlands and other European countries, district-heating systems in Scandinavian, Eastern-European and Chinese cities etc.
The wish to shift to renewables, the availability of affordable solar panels, heat storage systems, heat pumps and advanced insulated piping requires us to rethink these systems. Should we abandon our city gas grids and move to a district-heating grid fed by heat from renewable sources? Or could we invest instead in making our homes more energy-efficient and equip them with local, decentralised energy technology such as heat pumps that require only electricity? Residents can drive and need to be involved in such changes; for an increasing number of businesses these changes represent attractive businesses opportunities.
Any of these alternative systems must compete with the way our energy demand is met today, with advanced, mature legacy systems that connect us to fossil resources and satisfy our energy needs effectively and be affordable.
The large sunk investments, the existing capital stock, the experience and know-how, established companies and business practices, long-term contracts for supply all translate into resistance to change. The fierce competition for energy business, for capital to invest, for clients prevents sudden change of the system. This so-called ‘lock-in’ at various levels will make the transition from fossil fuels to renewables inevitably challenging, but not impossible.
If you are interested in reading more about this subject, the following links have been selected for you to have a look at:
- Constraints of renewables on Ted talks
- IEA’s Worldwide Trends in Energy Use and Efficiency, Chapter 8
- IEA’s Clean Energy Progress Report
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