How do firms promote stability in an evolving technological system? : The case of second generation biofuels in Norway

Abstract

This thesis aims to increase the understanding of the formative phase of an evolving technological innovation system (TIS) related to second generation (2G) biofuels in Norway. Large uncertainties and high risks are associated with the development and introduction of new environmental technology. The confrontation between technological opportunities and the market takes place in an environment largely determined by actors, the relationship between them and institutions. The co-evolution of technology, market and institutions does not happen automatically, but is set in motion by strategic actions of firms, governments, research institutes and other organisations. In order to increase the understanding of the innovation process related to 2G biofuels, I have applied the analytical framework of technological innovation systems and some chosen literature from transition management. The concept of stabilisation mechanisms is used, and amongst them, three have been selected and analysed as having an impact on the formative phase of the evolving TIS. This study focuses on what kind of knowledge search strategies firms conduct in order to reduce technological uncertainties. Further, how political networks are organised and their influence on institutions and market formation is examined. Finally, I look into how demonstration projects influence development of technology and market formation in this early phase.