Bioenergy Innovations: The Case of Wood Pellet Systems in Sweden

Abstract

In the context of global warming and strong dependence on fossil fuels, modern wood pellet heating systems for space heating of detached houses have emerged as a new technological option in many parts of the world. In Sweden, in recent years, such systems have advantages over oil-fired and electric boiler systems in terms of the expected total lifecycle heating costs to consumers. However, market diffusion of this technology has hitherto been rather slow. By combining an extended configuration cycle model with a dynamic multi-level perspective on system innovation, we study the factors involved in the diffusion of such systems in Sweden. The results indicate that energy policy, abundance of raw material and a wide dissemination of district heating systems have fostered the emergence and growth of the Swedish pellet market. However, other factors, such as a lack of co-ordination between the pellet and equipment suppliers in the early phase of market development, annual operating cost, lack of information, dissatisfaction among earlier adopters and technology lock-in might have contributed to the relatively slow growth of the market for small-scale systems.