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, centralised 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. In particular, we will focus on frameworks to analyse ‘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 behaviour, 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 organisations 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 sociotechnical systems.
• Energy consumer behaviour. 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.

This module is endorsed by the Copenhagen School of Energy Infrastructure (CSEI) at CBS and it is embedded in its overall strategy of research and education. CSEI is directly supported by the European Commission (DG Energy).