Understanding the role of incumbent utilities in sustainable energy transitions: A case study of the smart grid development in China

Abstract

Smart grids, although have been widely recognised as an enabling technology for delivering more sustainable energy futures, have however failed to reach significant deployment across the world. Drawing on the theoretical perspectives of governance, this paper critically examines and explains the role of incumbent utilities as an enabler or a barrier to sustainable energy transitions, with a particular reference of a case study of smart grid developments in China. We have two major findings in this working paper. First, China has developed an incumbent-led model for developing smart grids, in which two major state-owned grid companies have assumed central role in shaping the pathways and pace of the smart grid developments. Second, we specify that the grid operators played five major roles in the SG deployment. These include: 1) as planners, capital providers, builders, and managers of SG infrastructure; 2) as network operators; 3) as regulators; 4) as technology developers and knowledge creators; 5) as new energy service providers. This paper concludes by discussion future research agendas that emerge from a better understanding of the role of incumbent utilities in SG developments in China.