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2020/2021  KAN-CCMVV1731U  The Energy Industry in Transition: Markets, Innovation and Strategies

English Title
The Energy Industry in Transition: Markets, Innovation and Strategies

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Semester
Start time of the course Autumn
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 70
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Christian Erik Kampmann - Department of Strategy and Innovation (SI)
Main academic disciplines
  • Innovation
  • Strategy
  • Economics
Teaching methods
  • Face-to-face teaching
Last updated on 11-02-2020

Relevant links

Learning objectives
  • Account for and discuss the main challenges involved in the transition to a sustainable energy system, including definitions of what is meant by “sustainable”.
  • Account for the systemic nature of energy innovations and the sources of uncertainty and controversy this gives rise to.
  • Account for the economics of energy production, distribution and consumption.
  • Account for the principles underlying regulation and deregulation of power markets.
  • Account for and critically discuss the theories and conceptual frameworks in the course.
  • Demonstrate how these frameworks can be adapted or combined and applied to a concrete innovation strategy case (a company, technology or product) in the form of a short project (miniproject).
Course prerequisites
The course is open to students in the CBS cand.merc./M.Sc. program or equivalent. Some prior exposure to business strategy and innovation is an advantage but not required. Knowledge of microeconomics commensurate with a B.Sc. in business administration is expected. No technical knowledge of energy and power systems required.
The Energy Industry in Transition: Markets, Innovation, and Strategies:
Exam ECTS 7,5
Examination form Oral exam based on written product

In order to participate in the oral exam, the written product must be handed in before the oral exam; by the set deadline. The grade is based on an overall assessment of the written product and the individual oral performance.
Individual or group exam Oral group exam based on written group product
Number of people in the group 2-4
Size of written product Max. 20 pages
Definition of number of pages:
Groups of
2 students 10 pages max.
3 students 15 pages max
4 students 20 pages max

Note that the exam is a group exam. If you are not able to find a group yourself, you have to address the course coordinator who will place you in a group

Students who wish to have an individual exam might be able to write a term paper in the course. Please see the cand.merc. rules for term papers for more information.
Assignment type Project
Written product to be submitted on specified date and time.
15 min. per student, including examiners' discussion of grade, and informing plus explaining the grade
Grading scale 7-point grading scale
Examiner(s) Internal examiner and second internal examiner
Exam period Winter
Make-up exam/re-exam
Same examination form as the ordinary exam
* if a student is absent from the oral exam due to documented illness but has handed in the written group product she/he does not have to submit a new product for the re-take.
* if a whole group fails the oral exam they must hand in a revised product for the re-take.
* if one student in the group fails the oral exam the course coordinator chooses whether the student will have the oral exam on the basis of the same product or if he/she has to hand in a revised product for the re- take.
Course content, structure and pedagogical approach

Energy is essential for the functioning of modern economies, yet at the same time, CO2 emissions from energy production are 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 (over 85 BDKK, or 11% of exports in 2017) and employs about 75.000 persons. 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 will have to be re-designed to accommodate for intermittent sources of power from wind, solar, and marine sources. Energy generation will increasingly become distributed among many suppliers, from large centralized power plants to individual “prosumers”. These changes represent both a huge challenge for society and an opportunity for private enterprise, which will play a key role in the transition.
The purpose of this course is to give you a deep insight into the energy industry from a business perspective. You will be introduced to the physical realities that shape the functioning of energy markets, the development of the industry, and its unique characteristics. You will learn how both social and physical processes shape the energy system and how market institutions are crucial for allowing the future development of the system.
We take the point of view of the individual company with an emphasis on innovation and business strategy. We will focus in particular on frameworks to analyze “systemic innovation”, where the value of a product, process, or technology is fundamentally dependent upon its interaction with other parts of the energy system. We will apply frameworks from business strategy, innovation, microeconomics, the economics and politics of regulation, and consumer behavior, as they apply to concrete issues in the energy industry.
Throughout the course, we will involve guest lectures and arrange field visits to Danish energy companies and other organizations involved in the industry.
Outline of topics covered (both substantive areas and theory frameworks):
• Introduction: Fundamentals of energy technology and sustainable energy. The Danish energy system in an international context – challenges and opportunities.
• Smart grids and the economics of intermittent supply, energy storage, flexible demand, and grid and load defection.
• Innovation dynamics (S-curves, first-mover advantage/disadvantage, technology lifecycles)
• Path dependence, technological trajectories, technology transitions in socio-technical systems.
• Energy consumer behavior. Energy conservation in households and industry.
• Energy policy at the local, national and international level. Climate abatement policy.
• The economics of regulation and deregulation.
• Disruptive energy innovations. Business model innovations.
• Innovations in the transportation sector: Electric and hydrogen vehicles, car sharing, city logistics.
• Market institutions for flexible energy systems.
• Life cycle analysis.

Description of the teaching methods
The course will combine lectures, in-class discussions and guest presentations by representatives of the energy industry and key public sector authorities. In cooperation with the Danish Energy Association, we will also arrange optional field trips to visit power plants, water and waste treatment facilities, renewable energy producers, and other relevant sites related to the industry. The trips are not included in the formal teaching but are highly recommended as they provide a visceral impression of how the power sector works in real life. They have been immensely popular with students in previous years.
Feedback during the teaching period
Feedback during office hours
Student workload
Class attendance (including field classes and guest lectures) 33 hours
Miniproject + oral exam 80 hours
Reading, preparation 93 hours
Optional field trip 10 hours
Expected literature
  • • Carroll, A. B., & Shabana, K. M. (2010) The Business Case for Corporate Social Responsibility: A Review of Concepts, Research and Practice, International Journal Of Management Reviews, 12(1): 85-105.
    • Chesbrough (2010) Business Model Innovation: Opportunities and Barriers, Long Range Planning 43: 354-363.
    • Christensen, J.F.; Truffer, B.; Hekkert, M. (2018) Enterprise Strategies for Sustainable Innovation – Linking economic, organizational and institutional perspectives. EIS radar paper (draft). 50 pp.
    • Climate Interactive (2016) World Climate: A Computer-Simulation-Based Role-Playing Exercise. https:/​/​www.climateinteractive.org/​programs/​world-climate/​
    • Covert, T.; Greenstone, M.; Knittel, C.R. (2016) Will we ever stop using fossil fuels? Journal of Economic Perspectives, 30(1): 117-138.
    • Danish Energy Agency (2012) Energy policy in Denmark. http:/​/​www.ens.dk/​en/​info/​publications. 30 pp.
    • Danish Energy Agency (2014) An energy system without fossil fuels is technically possible. Energy scenario report. www.ens.dk. 28 pp.
    • DTU (2015) Chapter 3: Synthesis, in Larsen, H. H.; Sønderberg Petersen, L. (eds.), DTU International Energy Report 2015: Energy systems integration for the transition to non-fossil energy systems, pp. 10-14.
    • Energinet.dk and Danish Energy Association (2012) Smart Grid in Denmark 2.0: Implementation of three key recommendations from the smart grid network, report, www.energinet.dk.
    • Gadenne, D., Sharma, B., Kerr, D., & Smith, T. (2011) The influence of consumers' environmental beliefs and attitudes on energy saving behaviours, Energy Policy, 39(12): 7684-7694.
    • Ghosh and Nanda (2010) Venture Capital Investment in the Clean Energy Sector, Working paper 11-020, Harvard Business School, 22 pp.
    • Goldstein, N., R. Cialdini, et al. (2008) A Room with a Viewpoint: Using Social Norms to Motivate Environmental Conservation in Hotels. Journal of Consumer Research 35(3): 472–82.
    • Griffin, J. M., and S. L. Puller. (2005) Introduction: A Primer on Electricity and the Economics of Deregulation, in Electricity Deregulation: Choices and Challenges, University Of Chicago Press.
    • Guardian (2015) Fossil fuels subsidised by $10m a minute, says IMF, Article May 18. 4 pp.
    • Hockerts, K., & Wüstenhagen, R. (2010) Greening Goliaths versus emerging Davids — Theorizing about the role of incumbents and new entrants in sustainable entrepreneurship, Journal Of Business Venturing, 25(5): 481-492.
    • Hottenrott, H., Rexhäuser, S., & Veugelers, R. (2016) Organisational change and the productivity effects of green technology adoption, Resource & Energy Economics 43: 172-194.
    • J. Sterman (2015) Stumbling towards sustainability, in R. Hederson, R. Gulati and M. Tushman (eds.), Leading Sustainable Change, Oxford University Press. 32 pp.
    • Kiron, D.; Kruschwitz, N.; Reeves, M.; Goh, E. (2013) The Benefits of Sustainability-Driven Innovation. MIT Sloan Management Review, 54(2), 69-73.
    • LaMonica, M. (2013) Will Utilities Embrace Distributed Energy? MIT Technology Review (online version), 3 pp. https:/​/​www.technologyreview.com/​s/​514526/​will-utilities-embrace-distributed-energy/​
    • Lipp, J. (2007). Lessons for effective renewable electricity policy from Denmark, Germany and the United Kingdom. Energy Policy, 35(11), 5481-5495.
    • Lister, J.; Poulsen, R.; Ponte, S. (2015) Orchestrating transnational environmental governance in maritime shipping, Global Environmental Change, 34: 185–195.
    • Matzler et. al. (2015) Adapting to the Sharing Economy, Sloan Management Review, 56(2): 71-77.
    • Perloff (2012) Exhaustible resources, Section 16.3 in Microeconomics, 6th edition, Pearson, p. 580-586.
    • Porter and Kramer (2006) “Strategy & Society - The Link Between Competitive Advantage and Corporate Social Responsibility”. Harvard Business Review. 13 pp.
    • Poulsen, R.; Johnsen, H. (2016) The logic of business vs. the logic of energy management practice: understanding the choices and effects of energy consumption monitoring systems in shipping companies, Journal of Cleaner Production 112: 3785-3797.
    • Reinhardt, F.L. (1999) "Bringing the Environment Down to Earth." Harvard Business Review. 9 pp.
    • RMI (2015) The economics of battery energy storage (executive summary), Rocky Mountain Institute report. 6 pp.
    • RMI (2015) The economics of demand flexibility (executive summary), Rocky Mountain Institute report. 9 pp.
    • RMI (2015) The economics of grid defection (executive summary), Rocky Mountain Institute report. 4 pp.
    • RMI (2015) The economics of load defection (executive summary), Rocky Mountain Institute report. 13 pp.
    • Rothenberg, S. (2007) Sustainability Through Servicizing, MIT Sloan Management Review, 48(2): 83-89.
    • Smink, M. M., Hekkert, M. P.; Negro, S. O. (2015) Keeping sustainable innovation on a leash? Exploring incumbents' institutional strategies, Business Strategy & The Environment, 24(2), 86-101.
    • Smith, A., Stirling, A., & Berkhout, F. (2005) The governance of sustainable socio-technical transitions, Research Policy, 34(10): 1491-1510.
    • Unruh, G. C. (2000). Understanding carbon lock-in. Energy Policy, 28(12), 817-30.
    • van der Vleuten, E., & Raven, R. (2006). Lock-in and change: Distributed generation in Denmark in a long-term perspective. Energy Policy, 34(18), 3739-3748.
Last updated on 11-02-2020