Structural dynamics of innovation networks funded by the European Union in the context of systemic innovation of the renewable energy sector

Abstract

Innovation in the renewable energy (RE) sector relies on the concept of systemic innovation, which requires interaction between two innovation aspects: technology exploration and market exploitation. The European Union (EU) has introduced political instruments for systemic RE innovation by integrating resources from different thematic and geographic areas. However, using these instruments to establish an ecosystem for systemic innovation remains unexplored. This study develops a framework for evaluating the systemic innovation performance of networks through a time-series analysis of network structural properties. Overall, EU-funded innovation networks have not evolved in a systemic direction. First, the network exhibits densely connected local clusters for technology exploration and market exploitation of RE innovation, which are disconnected from each other. Over time, the gap between the two phases has weakened with increasing connectivity, but the local clusters supporting either explorative or exploitative activities have diminished. The existing networking linkages among organizations are considered ineffective because their positions in the network tend to display a mismatch with their innovation patterns. This research presents policy suggestions for optimizing the exploration and exploitation activities in the EU's funding program and their complementarities to establish a systemic innovation environment in the RE sector.