The En­ergy In­dustry in Trans­ition: Mar­kets, In­nov­a­tion and Strategies

Course content

Energy is essential for the functioning of modern economies, yet at the same time, CO2 emissions from fossil-based energy use is by far the largest contributor to global warming. In a Danish context, energy products and services and carbon-reducing energy technologies such as wind turbines, district heating, and insulation, account for a significant proportion of our exports (105,2 BDKK, or 11,3% of exports in 2021[1]) and employs about 73,000 persons[2]). To ensure a sustainable future, the entire system of energy production and consumption will have to be transformed in the decades ahead from fossil fuels to renewable energy sources. Transportation systems will have to be electrified to substitute renewable energy for fossil-based fuels. The electrical grid, storage systems, and consumption will have to be re-designed to accommodate for intermittent sources of power like wind and solar energy. Energy generation will increasingly become distributed among many suppliers, from large, centralized power plants to individual “prosumers”.  Enormous investments are required in conversion and sector coupling technologies, such as “Power-to-X”.  These changes represent both a huge challenge for society and an opportunity for private enterprise.

The purpose of this course is to give you a thorough insight into the energy industry, both from a private and public perspective.  You will be introduced to both existing and future technologies and an understanding of how the unique characteristics of the energy industry derive from the physical realities of these technologies.   Given the complex and multi-faceted nature of the energy transition, we will analyze it from different theoretical perspectives in an interdisciplinary manner.  Theories used include economics, business- and innovation strategy, finance, life cycle assessment, and consumer behavior.

The content of the course is very concrete, as we will involve practitioner guest lecturers and arrange field visits to power plants, waste treatment plants, experimental engineering labs, and other relevant sites.

Specific problem areas covered are

• The overall challenges and opportunities we face in the transition to a sustainable energy system, particularly the large-scale conversion to renewable energy technologies.
• Recent developments in energy technologies and associated costs.
• The environmental, social, and economic consequences of these technologies and the tradeoffs between them.
• The systemic and complex nature of energy transition and the uncertainty and controversy this gives rise to.
• How outcomes are affected by consumer behavior.
• The roles of policy making and market design at the local, national, and supra-national levels.
• The challenges of financing energy-related ventures and investments.
• The implications for business strategy and decision making.

Theoretical frameworks employed are

• Economics of energy production, transmission, distribution, storage, and consumption.
• Economics and functioning of power markets and ancillary services.
• Economic theories underlying regulation and deregulation of energy markets and greenhouse gas emissions, and how real-life regulation is affected by politics.
• Consumer choice theory.
• The principles and real-life complexities of life cycle assessments and carbon accounting.
• The dynamics and associated business strategies of innovation, technology life cycles, transitions, and platforms.
• Investments and strategy making under uncertainty.
• Basic principles of finance and how they relate to energy ventures and investments.

Nordic Nine areas that the course addresses

• N1: You have deep business knowledge placed in a broad context.  The course provides a deep knowledge of the energy industry, placed in the broader context of the transition from fossil fuels to alternative energy sources. 
• N2: You are analytical with data and curious about ambiguity. It reveals the complexities and uncertainties of this transition and its environmental consequences
• N3: You recognize humanity’s challenges and have the entrepreneurial knowledge to help resolve them.  It outlines in concrete terms the challenge of the transition as well as the opportunities it raises for new business
• N5: You understand ethical dilemmas and have the leadership values to overcome them.  It highlights the tradeoffs in different solutions to bringing down greenhouse gas emissions and how they are ultimately guided by political values.
• N6: You are critical when thinking and constructive when collaborating. Through its interdisciplinary approach to the problems, it encourages critical reflection of the different theoretical perspectives and their strengths and limitations.
• N7: You produce prosperity and protect the prosperity of next generations. It will enable participants to create value for businesses while at the same time contributing to the transition to a sustainable energy system.

[1] Source: Danish Federation of Energy Industries, hhtps://www.danskindustri.dk/brancher/di-energi/analysearkiv/brancheanalyser/2022/eksport-af-energiteknologi--og-service-2021/

[2] Source: Danish Federation of Energy Industries, https://www.danskindustri.dk/brancher/di-energi/rapporter-og-holdninger/Analyser-og-branchetal/