Innovation and diffusion through environmental regulation
Jänicke, Martin ;  Mez, Lutz ;  Bechsgaard, Pernille ;  Klemmensen, Børge ;  ;  Forschungsstelle für Umweltpolitik (FFU), Freie Universität Berlin

Main titleInnovation and diffusion through environmental regulation
Subtitlethe case of Danish refrigerators
AuthorJänicke, Martin
AuthorMez, Lutz
AuthorBechsgaard, Pernille
AuthorKlemmensen, Børge
InstitutionForschungsstelle für Umweltpolitik (FFU), Freie Universität Berlin
No. of Pages30 S.
Series FFU-report ; [19]98-3
Classification (DDC)330 Economics
600 Technology
AbstractThis study begins by looking at the retail success of class A, B and C energy-saving
refrigerators in Denmark between 1994 and 1997, where their market share rose from
42% to around 90%. It also examines analogous innovation by the leading Danish
manufacturer of refrigeration units, Gram, which has developed, among other things,
equipment whose energy consumption is a further 40% lower. The innovation described
here could, over ten years, reduce energy consumption by refrigerators without
freezer compartment by a factor of ten.
The hypothesis which immediately suggested itself was that both processes - diffusion
and innovation - could be traced back to the rise in energy tax which made itself felt
with the comprehensive environmentalist revision of taxation in 1994, and further
gradual increases until 1998. The results of this study, however, show that any explanation
requires a broader approach.
At the very least, the explanation must include a mix of different instruments. The
necessary condition for retail success of the best appliances was certainly the energy
tax - which is levied according to CO2 emissions. Nevertheless, without the further
instrument of labelling the energy consumption of appliances (1989, also issued as an
EU guideline in 1994, coming into force for refrigerators in 1995), the effect would
scarcely have been to be expected. In addition to this came training connected with
the labelling for sales staff by the Energy Agency (1994). An instrument which also
explains this retail success was the national and regional energy saving campaigns, in
which the energy supply companies participated (1994 and 1995). Finally, the campaign
also included an upgrade incentive of 200 DK for replacing an old appliance
with one of the best models (1994). The Danish public’s widespread awareness of
environmental and climate change issues must also be considered as a background
For the innovations at the Danish manufacturer Gram, state R&D funding played a
considerable part, implying the formation of innovation networks. Here also, the energy/
CO2 tax is a significant background condition, although the company itself did
not consider it decisive. The EU’s Maximum Consumption Guideline, which will
come into effect in Denmark in 1999, making existing energy-saving models standard,
is also considered especially important. New markets were thus only accessible
through further improvements, and retailers also had to ensure that inefficient appliances
were removed early on from their product ranges and warehouses.
The project has also borne methodological fruit. With respect to the broad spectrum
of instruments which have come into effect, the significance and configuration of the
participating actors and the cooperative, forward-looking policy style of the regulating authorities, the extended concept of a “regulatory framework” proves to be heuristically
useful. The same applies for the bottom-up approach to policy evaluation,
which affords the necessary openness for the breadth and dynamics of the influential
In the Danish case studied here, innovation follows diffusion. Both were brought
about by an essentially strategic approach to environmental and climate protection
policy, notable for its committed, but negotiated, development of aims (CO2 reduction,
energy saving), its good technological policy infrastructure and the close networking
between public and private sector actors. Of particular note was the breadth
and flexibility in applying instruments, from indicative long-term planning, through
energy taxation, subsidies and informal instruments, to efficiency standards.
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FU DepartmentEnvironmental Policy Research Centre
Year of publication1998
Type of documentBook
Terms of use/Rights Nutzungsbedingungen
Authors commentsJoint Research Project
„International Case Studies on Innovation Effects of Environmental Regulation“
within the research consortium
„Innovative Effects of Environmental Instruments“
Created at2010-11-12 : 02:38:05
Last changed2015-07-01 : 10:35:39
Static URLhttp://edocs.fu-berlin.de/docs/receive/FUDOCS_document_000000007580