including active industrial policy. Chinese provinces and many Indian states also
have state-owned energy utilities with soft budget constraints, a situation which
has given policy-makers more room for manoeuvre in the balance between pro -
viders and users, and has also softened negative policy feedback that might work
through private sector incumbents.
However, one key difference between the two countries that helps explain why
the pace of wind expansion is currently faltering in India and not in China is the
unwillingness of policy-makers in India’s central government to continue to
subsidize wind via accelerated depreciation. This unwillingness can be explained
in part by the policy paradigm of the current Indian government led until 2014
by Prime Minister Manmohan Singh, who has pursued a series of reforms over
the last decade aimed at liberalization, tax simplification and fiscal consolidation
clearly influenced by the ideas of orthodox economics.
Conclusion
What constitutes a green transformation will be open to contestation, but for any
kind of transformation actually to occur it must be politically sustainable. Alliances
for transformations need not only to be formed but also maintained and expanded.
In this sense, if policies (or actions or campaigns by social movements) are to be
successful in bringing about green transformations, they must be self-reinforcing,
creating constituencies for their own implementation and expansion.
In terms of the concepts explored here, this means that policies must have a
preponderance of positive feedback effects over negative ones if they are to
become ‘locked in’. For many sustainability problems, including climate change,
this represents a major challenge, since transformative policies fly in the face of
existing high-carbon lock-in and will challenge existing vested interests, norms and
institutions. In that sense, policies for green transformations are always likely to
encounter negative feedback.
Here I have argued that an important factor in the balance between positive
and negative feedback effects is the design of policies, using a number of com -
parative case studies. For example, Germany’s policy approach has been to distribute
subsidies from policy relatively widely and use industrial policy to create employment, both of which have created important positive feedback effects to offset
the inevitable negative feedback on the costs of the policy. This is not so much a
case of grassroots innovation from below (see Smith and Ely, this book) as mass
appropriation of innovation from above. The UK’s renewable support mechanism
has done neither of these things, leaving subsidy to be captured by large and highly
unpopular energy incumbents and the policy exposed.
I have also argued that both policy design and political effects in turn will depend
in part on institutional systems and dominant policy paradigms present in a country.
Again, taking the contrast between the UK and Germany, a technology-neutral,
market-mimicking policy was the natural fit for the liberal policy paradigm in the
Political dynamics of green transformations 99
have state-owned energy utilities with soft budget constraints, a situation which
has given policy-makers more room for manoeuvre in the balance between pro -
viders and users, and has also softened negative policy feedback that might work
through private sector incumbents.
However, one key difference between the two countries that helps explain why
the pace of wind expansion is currently faltering in India and not in China is the
unwillingness of policy-makers in India’s central government to continue to
subsidize wind via accelerated depreciation. This unwillingness can be explained
in part by the policy paradigm of the current Indian government led until 2014
by Prime Minister Manmohan Singh, who has pursued a series of reforms over
the last decade aimed at liberalization, tax simplification and fiscal consolidation
clearly influenced by the ideas of orthodox economics.
Conclusion
What constitutes a green transformation will be open to contestation, but for any
kind of transformation actually to occur it must be politically sustainable. Alliances
for transformations need not only to be formed but also maintained and expanded.
In this sense, if policies (or actions or campaigns by social movements) are to be
successful in bringing about green transformations, they must be self-reinforcing,
creating constituencies for their own implementation and expansion.
In terms of the concepts explored here, this means that policies must have a
preponderance of positive feedback effects over negative ones if they are to
become ‘locked in’. For many sustainability problems, including climate change,
this represents a major challenge, since transformative policies fly in the face of
existing high-carbon lock-in and will challenge existing vested interests, norms and
institutions. In that sense, policies for green transformations are always likely to
encounter negative feedback.
Here I have argued that an important factor in the balance between positive
and negative feedback effects is the design of policies, using a number of com -
parative case studies. For example, Germany’s policy approach has been to distribute
subsidies from policy relatively widely and use industrial policy to create employment, both of which have created important positive feedback effects to offset
the inevitable negative feedback on the costs of the policy. This is not so much a
case of grassroots innovation from below (see Smith and Ely, this book) as mass
appropriation of innovation from above. The UK’s renewable support mechanism
has done neither of these things, leaving subsidy to be captured by large and highly
unpopular energy incumbents and the policy exposed.
I have also argued that both policy design and political effects in turn will depend
in part on institutional systems and dominant policy paradigms present in a country.
Again, taking the contrast between the UK and Germany, a technology-neutral,
market-mimicking policy was the natural fit for the liberal policy paradigm in the
Political dynamics of green transformations 99