Future energy systems and complexity science

The present system of energy supply and demand will need a significant change in order to address the three major challenges of European energy policy: sustainability, security of supply and competitiveness while guaranteeing energy equity. These three challenges entail complex interactions between public and private actors, governments and regulators, economic and social factors, national resources, environmental concerns and individual behaviours (World Energy Council, 2016). This emerging complexity calls for a broader methodological approach to energy studies to include also qualitative and more human cantered methods of data collection (e.g.: interviews, field research, focus groups, etc.) as well as novel simulation approaches (e.g.: agent based modelling) and should also cover issues of energy poverty, psychology and consumer behaviour, social practices theory, social construction of technological systems and so on (Sovacool, 2014; Rai et al., 2016). This is important as the social and cultural context that surrounds the energy system and their mutual relationship cannot be neglected.

Emerging energy systems (also called smart energy systems or simply referred to as "smart grids") thanks to a pervasive incorporation of information and communication technologies will enable bidirectional communication and power exchange between suppliers and consumers, transforming the traditionally passive end-users into active players. These emerging energy systems can be conceived as complex adaptive systems; they can be represented in terms of dynamic complex multi- layer structure that integrates various different, interacting layers. The interconnections between the different layers exhibit an emerging complexity in which it is impossible to abstract the overall behaviour by the analysis of a single component (Masera et al., 2013). Complexity science and its associated modelling methods allow the exploration of the interactions between these different elements of a system and of how the different elements of the system give rise to collective emergent behaviours.

Analysis of possible policy measures and instruments to approach the challenges that these emerging systems pose are still dominated by techno-economic models that do not reflect the full complexity of the energy systems, in particular for what concerns systems' interactions and actors' behaviours.

Emerging energy systems should be treated as a "system of systems", in other words they should be seen

as "a collection of task-oriented or dedicated systems that pool their resources and capabilities together to obtain

a new, more complex ‘meta-system’ which offers more functionality and performance than simply the sum of the constituent systems" (IEEE-Reliability Society, 2014); they are composed of many self-governing

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components that respond to different economic and environmental drives beyond the simple operational ones. In this context, complex systems thinking and modelling is valuable in understanding the complexity of energy systems in order to address current and future policy challenges (Bompard et al., 2012; Bale et al., 2015).

The implementation of smart energy systems will change the way we live our lives and how we interact socially and culturally. Social actors in the energy landscape will need to adapt their behaviours, strategies and means of producing, delivering, storing, and consuming energy. Emerging electricity systems design and implementation will need to be coupled with broader social and cultural considerations in order for these to be successful.

A smart electricity system is not only a diverse set of dynamic, distributed energy suppliers, it is also an energy system which connects smart (i.e., responsive, energy efficient, and variable) users to sustainable (i.e., low carbon, renewable) energy sources. And the grid itself is smart whenever it is able to modify its output, and able to monitor, control and meter the energy demands of consumers in a regulated and fair way (Bompard et al., 2012).

2.1.1 A research agenda for emerging electricity systems

The results of a JRC workshop on "Smart Energy Grids and Complexity Science" (2012) propose a series of points for a research agenda for a complexity science approach to emerging electricity systems that can be useful for the purpose of the present thesis. They propose:

 a unified approach based on complex system views and methods: this shall embrace the technological, social, business and environmental complexity of the emerging energy systems in a unified view that aims at promoting sustainability and resilience through model based problem solving;

 acknowledgment of the complexity within and around the emerging electricity systems: the energy system infrastructure and its evolution are closely intertwined with a wider set of contexts (i.e.: social, technical, economic, environmental..). The interaction of these contexts with the emerging energy system is difficult to be represented through traditional approaches. It is not only complexity within the energy system that emerges, but also complexity of the interactions with the surrounding contexts. Addressing complexity within and around the emerging energy system will provide the way to the full understanding of the overall sustainability of the system;

 a multi-scale modelling approach: the multi-scale phenomena that will emerge at societal, technological, environmental and business level and the system behaviour need to be properly addressed with multi-scale modelling using information or models from different levels. The aim is to develop an approach that include the growing links and correlations in and around the

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emerging electricity systems, i.e.: how society and technology co-evolves, how new business and social models will enable new patterns for the generation, distribution and consumption of energy;

 new approaches to sustainability and resilience: emerging energy systems will entail new opportunities and scenarios that will encompass new risks that need to be taken into account. Complexity science may help in developing new approaches to resilience assessment;

 complexity versus simplicity: the challenge of a complexity science approach is to find ways of simplifying the representation and understanding of the systems. Approaching the heterogeneous characteristics of emerging energy systems with complexity science and theories lenses, simple rules and strategies could be designed and tested for a set of representative phenomena and scenarios;

 empowering stakeholders: at the core of the emerging energy system is the empowerment of stakeholders such as consumers, communities, governments and other institutions. Co- dependency of individuals will promote the creation of communities that will share benefits while receiving and paying fair tariffs for the electricity generated and consumed. There is the need to better understand the energy consumers and anticipate lifestyles in light of their adaptation to new social and economic settings. How easily will users adapt or adopt the new system? Which kind of support will they require from authorities and utilities? How long might it take for a fully functional “smart powered” society? In addition, one can foresee that emerging behaviours of prosumers/consumers will require and force the development of new mind-sets, which could parallel the emergence of social networks around the Internet. Some key questions could then be posed to society, e.g. How to change environmentally important behaviours?

2.1.2 Energy as a wicked problem

The emerging issues in the energy system transition are variably referred to as complex, wicked, untamed or unstructured (Valkenburg et al., 2016). Wicked problems are in general poorly identified and defined and they are influenced by factors in multiple and often contradictory ways; they may be constantly changing and do not have objectively optimal solutions; any solution found will be deeply entrenched in the social context in which it has been developed (Brunswicker et al., 2017). Proposed solutions for "energy wicked problems" may be addressing the symptoms instead of underlying causes. The knowledge base required for effective implementation may be weak, fragmented or contested. Wicked problem in policy research are characterized by unknown or very ambiguous goals and highly uncertain and poorly understood means-ends relationship (Head, 2008). It is argued (Head, 2008) that conventional explanations for "wicked problems" usually tend to focus on weaknesses and deficiencies in the public sector’s implementation and delivery mechanisms (e.g.: lack

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of skills or competences, inadequate funding, poor communication and consultation, lack of commitment, lack of authority to achieve the right level of coordination, etc.). However, the concept of wicked problems "potentially adds another layer of explanation and new research questions, focusing mainly

on the understandings that have shaped problem-identification and thus the frames for generating

problem-solutions" (Head, 2008). Very often, due to the lack of this understanding, failures and unintended outcomes are likely to be endemic in many complex areas of policy and program delivery, for several reasons that may span from poor problem identification and scoping, the changing nature of the problem being addressed and, more specifically to energy policy, to the need to achieve a major shift in consumers' attitudes and behaviours without having put in place sufficient incentives or the right tools to ensure that such shifts are actualised. Considering the behavioural change that is advocated in the energy transition, traditional levers (laws, taxes, economic incentives and subsidies) may not suffice to realize the desired behavioural shift (Kolk, 2012). The "wicked" nature of the challenges posed by the emerging energy systems requires iterative ways of knowledge production as well as reflexivity in governance in order to address the complexity that emerges due to both normative (i.e.: uncertainties about how to decide and how to act) and factual uncertainty of the transitioning energy system. In science for governance, reflexivity is needed to device new strategies to cope with problems as well as to reflect if the same institutional structure of governance needs revision. Indeed the institutional structure of governance may need revision to facilitate the development of those novel strategies (Valkenburg et al., 2016). This implies that the entity deciding about the validity of knowledge claims (what Kovacic (Kovacic et al., 2015a) defines as "the story teller") reflects on the values and goals that have driven the "choice of narrative". In the case this narrative informs policy decisions, it is fundamental to verify the relation between the analyst's choice of values and the social shared values. These considerations will help me in shaping and framing my analysis on the role of the consumers in the energy transition that I will further develop in the following chapters.