Regional energy efficiency networks – what factors make them successful?

Panel: 5. Business models and financing: established practice and innovative approaches

This is a peer-reviewed paper.

Authors:
Elisabeth Dütschke, Fraunhofer ISI, Germany
Simon Hirzel, Fraunhofer ISI, Germany
Farikha Idrissova, IREES, Germany
Lisa Nabitz, Fraunhofer ISI, Germany
Ursula Mielicke, Fraunhofer ISI, Germany
Michael Mai, IREES

Abstract

Energy efficiency networks have received increasing attention over the last few years, not only from national governments (Austria, China, Germany, Sweden and Switzerland), but also from utilities, consulting engineers, chambers of commerce, and city councils. This paper examines the factors that contribute to the success of such networks by drawing on unique data from two pilot projects with 34 energy efficiency networks in Germany. The objective is to explain why companies participating in such networks are much faster at reducing their energy costs than the average in similar businesses. Possible explanations for the success of energy efficiency networks include: (1) energy audits make profitable potentials visible; (2) the joint network targets for efficiency and emissions increase the motivation of energy managers, decision-makers and other staff members; (3) the meetings and site visits to the network participants act like an intensive training course. They increase the knowledge of efficient solutions, change decision routines, and lead to trust among the participants, thereby reducing transaction costs. In our data, we find support for the first and the third explanations, i.e. the audits make profitable potentials visible and networks function as a training course to increase knowledge. The impact of network goals, on the other hand, appears to have both up- and downsides. We conclude with the need for further research in order to capture these mechanisms in more detail.