Nicolai Herrmann. Regional Energy 2050: A sustainability-oriented strategic backcasting methodology for local utilities
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1 Nicolai Herrmann Regional Energy 2050: A sustainability-oriented strategic backcasting methodology for local utilities Rainer Hampp Verlag Miinchen, Mering 2011
2 Overview 1 Introduction and definitions Problem statement and motivation Derivation of research questions Initial assumptions and definitions Sustainability - definition and adaptation for the energy sector Summary and conclusion for chapter one ' 60 2 Sustainability and business strategy Perspectives on corporate economic and environmental performance Definition of a strategic development corridor for corporations Strategic necessity of corporate sustainability-orientation Summary and conclusion for chapter two :..r...' Future studies and business strategy Introduction to future studies History and state of the art of backcasting Strategic backcasting and other strategy schools Arguments for a novel backcasting methodology for local utilities Summary and conclusion for chapter three A novel strategic backcasting methodology for local utilities Definition of criteria and targets for a sustainable future energy system Description of a regional target scenario Analysis of status quo Derivation of external crossroads and internal milestones Identification of a strategic development pathway Summary and conclusion for the methodological section Case study - sample application of strategic backcasting Step 1: Definition of criteria and targets for the future energy system Step 2: Description of a regional target scenario Step 3: Description of the status quo Step 4: External crossroads and internal milestones Step 5: Identification of a strategic development pathway Summary and conclusion for the case study Critical assessment and conclusions Lessons learned from the case study Critical reflection of the strategic backcasting methodology Further research needs Summary and conclusion for chapter six 306
3 Table of contents Abstract 13 Summary 14 1 Introduction and definitions Problem statement and motivation Derivation of research questions Initial assumptions and definitions Initial assumptions Definition of energy The energy sector as a subject Local utilities in the German energy sector Conclusion and working hypothesis for this paper Sustainability - definition and adaptation for the energy sector The basic concept of sustainability Different capital stocks and schools of sustainability An applicable understanding of sustainability for local utilities Hierarchy of sustainability dimensions for the energy sector Focus on ecological sustainability Definition of sustainability targets for the energy sector Mitigation of climate change as a superior sustainability requirement Summary and conclusion for chapter one 60 2 Sustainability and business strategy Perspectives on corporate economic and environmental performance Win-lose perspective Win-win perspective ' Rational system perspective Argument for a rational system perspective Definition of a strategic development corridor for corporations Natural resource limitations as a fundamental driver for business strategy Societal limitations as a fundamental driver for business strategy A long-term-oriented strategic development corridor for corporations Natural system limitations Societal system boundaries Nature of change in the strategic development corridor 76
4 2.3 Strategic necessity of corporate sustainability-orientation Different strategy approaches within the strategic development corridor The reactive strategy approach The proactive strategy approach Description of proactive and reactive strategy pathways Proactive strategies and the emergence of competitive advantage The resource-based view of the firm The natural resource-based view of the firm Summary and conclusion for chapter two 89 3 Future studies and business strategy Introduction to future studies Scenarios as a prospective method in future studies Two different scenario design philosophies Introduction and critique of forward scenarios Introduction and critique of backward scenarios Methodological applicability of backcasting Strategic backcasting for organisations History and state of the art of backcasting Practical applications of backcasting 110, Similar methodological approaches in future studies Strategic backcasting and other strategy schools Two basic understandings of strategy Existing strategy schools Classical strategy approach Evolutionary strategy approach Processual strategy approach Systemic strategy approach Classification of existing strategy schools Critique of classical strategies and location of strategic backcasting Strategic backcasting and risk reduction Challenges for strategic backcasting as a method of strategic management Arguments for a novel backcasting methodology for local utilities Summary and conclusion for chapter three 125
5 4 A novel strategic backcasting methodology for local utilities Definition of criteria and targets for a sustainable future energy system Problem statement and analysis of problem nature Problem complexity and occurrence of externalities Temporal problem dimension and persistency Spatial problem dimension and pervasiveness Problem urgency Nature of fundamental problem drivers Dimension of necessary solutions Definition of study scope and general target framework Applicable definition of sustainability and sustainable development Determination of specific sustainability targets Methodological discussion of criteria and target definition Quality criteria for the definition of sustainability targets Description of a regional target scenario Definition of scenario scope Analysis of existent long-term energy scenarios Synthesis of a regional target scenario Methodological discussion of target scenario design Necessary nature of a target scenario for strategic backcasting Classification of long-term energy scenarios Analysis of status quo Methodological discussion of status quo analysis Instruments for the analysis of regional energy systems Comparison to the national situation and discussion of applicability Assessment of existing potentials for target-oriented development Derivation of external crossroads and internal milestones Identification of external crossroads Methodological discussion of external crossroad analysis Relevance for strategic backcasting in local utilities Conclusion and historic evidence for external crossroad analysis Identification of internal milestones Approach for identification and ranking of internal milestones Methodological discussion of internal milestone selection Role of innovation for strategic backcasting
6 4.5 Identification of a strategic development pathway Methodological discussion of strategic development pathways Investment rationales for the strategic development pathway Linking external crossroads to internal milestones Summary and conclusion for the methodological section Case study - sample application of strategic backcasting Step 1: Definition of criteria and targets for the future energy system Problem statement and analysis Problem statement Problem analysis General framework definition :.."..! Corporate scope - the local utility MVV Energie AG in Mannheim Regional scope - the Metropolitan Region Rhine-Neckar Definition of sustainability General sustainability targets and company-specific target setting Lead target of sustainable emission reductions A long-term CO2 reduction target for industrialised countries Emission reduction targets on the micro-economic level Discussion of additional sustainability targets for the case study 225, Conclusion for the case study scope and target system Step 2: Description of a regional target scenario Scope for the target scenario Analysis of existing long-term energy scenarios Scenario synthesis Future energy demand Population development in the regional target scenario Energy-related carbon emissions in the regional target scenario Conclusion for the case study target scenario Step 3: Description of the status quo Sample status quo analysis for energy supply and demand in MRN Present and future role of nuclear energy in MRN Status quo of renewable energy utilisation in MRN Energy-related emissions in MRN Comparison to German average Sample analysis of corporate status quo Generation portfolio MVV Energie
7 Analysis for a power plant in MRN Assessment of regional potentials to realise sustainable development Technical potential of renewable energies in MRN Critical reflection on technical potentials in MRN Conclusion for the case study status quo analysis Step 4: External crossroads and internal milestones Analysis of external crossroads for a local utility External crossroads until 2020 the post-kyoto period External crossroads in the long-term to Internal milestone selection Setup of a corporate expert group for internal milestone selection Selection of internal milestones Conclusion for external crossroad analysis and internal milestone selection Step 5: Identification of a strategic development pathway Sample strategic ranking of regional renewable resources in MRN A regional strategy for long-term sustainability in MRN Summary and conclusion for the case study Critical assessment and conclusions Lessons learned from the case study Problem statement and analysis Definition of sustainability and sustainability targets Definition of a regional target scenario Status quo description External crossroad identification Internal milestone selection Definition of a strategy pathway Critical reflection of the strategic backcasting methodology ' Further applicability of the strategic backcasting method Further research needs Summary and conclusion for chapter six 306 i List of figures 308 List of tables 311 Reference list
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