open innovation in urban energy systems

Open innovation in urban energy systems

Marlen Arnold & Volker Barth

Received: 9 April 2011 /Accepted: 26 October 2011 /Published online: 17 November 2011# Springer Science+Business Media B.V. 2011

Abstract Despite recent efforts, existing urban ener-gy systems still hardly meet the demands of sustain-able development or climate change. Meeting thesetargets thus will require innovations that use energymuch more efficiently and emit far less greenhousegases. These innovations need to be made on theproduction as well as the consumption side, on alllevels, and need to cover not only technical aspects,but even more service solutions. While many of thesesolutions still need to be developed, some are alreadyinvented but only exist in limited market segments.Opening closed urban planning processes and usingopen innovation tools can foster bottom-up urbanenergy system transformation by addressing theinteractive ways of decision-making integrating com-pany representatives and citizens. While open inno-vation tools like (open) innovation workshops orideas competitions are already used by severalcompanies to find and develop new designs andproducts, there is yet little experience with energyefficiency ideas and bottom-up changes. Therefore,

we analyse energy-efficient ideas generated in threedifferent ideas competitions. We discuss the findingsfor theory and research on open innovationapproaches and bottom-up urban changes. Our resultsshow that there are a vast number of ideas available inthe public. Open innovation tools offer advancedpossibilities to generate energy-efficient solutions.

Keywords Energy efficiency . Open innovation .

Bottom-up urban transformation . User integration .

Service innovation . Urban planning processes

Introduction

A sustainable development and climate protectionaddress fundamental challenges to prevailing businessmodels as companies, trying to implement sustainableand social–ecological requirements, may find theirconventional way of operating fundamentally chal-lenged (Arnold 2010). Contemporary energy systemshave troubles meeting the requirements of a sustain-able development. The emissions from burning fossilfuels have immediate (SO2, soot) and long-term(greenhouse gases) consequences (acidification, airquality and global warming). The global distributionof producers and consumers of fuels leads todependencies and political tensions and threatensenergy security (Jonsson 2011). Similar problemsarise with nuclear power—resources are also limited,severe environmental impacts result from mining and

Energy Efficiency (2012) 5:351–364DOI 10.1007/s12053-011-9142-6

M. Arnold (*)Technische Universität München,TUM School of Management,Freising, Germanye-mail: [email protected]

V. BarthCarl von Ossietzky Universität Oldenburg,Ecological Economics,Oldenburg, Germany

disposal and proliferation risk adds to the politicalcomplications—which is consequently no alternativeeither. Even on the global scale, sustainable develop-ment thus requires a restructuring and transformationof the energy system (Kuronen et al. 2010). Improv-ing energy efficiency is one way to start this processas it slows down the increase in resource consumptionand emissions. It therefore helps to gain time in orderto find and implement alternative energy systems.These challenges require new or recombined knowl-edge or ideas and fundamental changes in corporatestrategy and objectives for the majority of allcompanies as well as administration and departmentsfor urban development (Arnold 2010; Kern and Smith2008). Therefore, going beyond traditional boardersof ideas development could foster a sustainabledevelopment. Open innovation, opening closed urbanplanning processes as well as user integration are keyelements for implementing sustainability effectivelywithin companies and combating climate change.

Opening closed urban planning processes addressesthe interactive ways of decision-making by integratingcompany representatives and citizens. User integrationmeans including future customers and users in theinnovation process on a targeted basis—from the initialidea all the way to introduction and diffusion of theinnovation in the marketplace (phases: invention,development, testing, implementation and diffusion).Using this interactive or open innovation approach, thesocial–ecological effects of sustainable consumptionand often also production can be identified andimplemented into new products, services or conceptsand strategies at an early point in time. In recent years,open innovation tools (OITs) are increasingly andsuccessfully applied to bridge the gap between ideaslingering in niches and the economic forces that areneeded to implement them in mainstream markets.Important OITs are ideas competitions and the integra-tion of lead users and communities in the innovationprocess (Franke and Piller 2004; Piller et al. 2004;Chesbrough 2003).

While many companies have recognized the useand effectiveness of OIT and use them regularly butstruggle with implementation, applications in thepolitical arena are few. This is quite astonishing sinceOITs are close relatives to participatory methods,which in turn are widely used in political planningprocesses, also in cities. It thus seems to be apromising exercise to apply OIT in order to improve

the energy efficiency of urban energy systems, whichhave both an economic and a political aspect. Thispaper describes such an attempt, conducted as casestudy research, where ideas competitions in connec-tion with lead user workshops and focus groups havebeen applied to the city of Munich, Germany.Additionally, we take two other ideas competitionsinto account conducted in the same research area. Inthe paper, the following question will be addressed:Can energy-efficient innovations, generated and de-veloped by users, improve and accelerate sustainabledevelopment and climate protection? How can openinnovation tools or interactive urban planning fosterurban energy transition? Therefore, we analyseenergy-efficient ideas generated in three differentideas competitions. We discuss the findings for theoryand research on open innovation approaches andbottom-up urban changes. After a short overviewover the characteristics of urban energy systems andplanning as well as open innovation tools in ‘UrbanEnergy Systems and Urban Planning’ and ‘OpenInnovation’ sections, we describe our approach in the‘Case Study and Method’ section. In the ‘Results andFindings’ section, we present our results based on theideas competitions and draw some conclusions in thefinal section.

Urban energy systems and urban planning

Climate protection and therefore the mitigation andreduction of carbon emissions are of crucial interestworldwide, in the European Union as well as inGermany. Energy systems show different specifica-tions and can be described on different levels(Phdungsilp 2010; Kuronen et al. 2010). They areheterogeneous and often characterised by decentral-ised as well as centralised structures depending on theenergy production and consumption. Integrated as-sessment is often used to analyse and describe energysystems (Agusdinata and DeLaurentis 2008). Energyis used in different field of activities. The mostenergy-consuming fields beside production in generalare mobility and housing (Perrels 2010; Staley 2009;Norman et al. 2006; Bin and Dowlatabadi 2005;Reinders et al. 2003; Munksgaard et al. 2000; Lenzen1998). Amin (2002, 67) points accurately: ‘Infra-structures are complex networks, geographicallydispersed, nonlinear, and interacting both among

352 Energy Efficiency (2012) 5:351–364

themselves and with their human owners, operatorsand users’. With respect to climate protection andenergy efficiency, there seems to be a network ofdifferent actors necessary to establish new energy-efficient solutions as well as improve existing ones(Jonsson 2011).

The mobility field is shaped by the combination ofmany subsectors and technology fields, a wide researchcommunity and a close connection with users andcompanies. Solutions for mobility and transportationperformance are of importance for the economy andsociety in a regional and international perspective(Tanatvanit et al. 2003). The housing sector’s greatestchallenge is the improvement of energy efficiency andthe use of carbon neutral energy sources in new andexisting flats and houses (Ürge-Vorsatz et al. 2009).Heat provision in households is the source of some12% of German CO2 emissions (UBA 2008). Im-proving the energy efficiency of new and existingbuilding can be either achieved through incentives orregulation such as government intervention as well asthe citizens’ stimulation to take action. Moreover,there are strong interdependencies between the mo-bility and housing sector, especially in light of travel,spare time activities, shopping, etc. However, the roleof open innovation processes is often unclear. Withregard to urban planning processes and the imple-mentation of climate protection urban activities, thereis a need from separation to joint processes and theintegration of several stakeholders (Väyrynen 2007).Therefore, we highlighted mobility and housing aswell as their interrelations in our case study research.

These problems form the background when dis-cussing the challenges for the setup and restructuringof urban energy systems. Improving energy efficiencyin complex systems like cities is likely to be a processthat requires both large, systemic changes, but alsomany small, and sometimes subtle, improvements.The continuous experiences of many inhabitants withmany urban problems can also be seen as a nutrientfor ideas to overcome many of these. It is a commonobservation that most ideas finally leading to innova-tions already exist, either in slightly modified form orin places or (market) niches where they tend to beoverlooked. The big question is how to find theseideas and to help them permeate into the mainstreammarket. Thus, we highlight the role and possibilitiesof open innovation as means of bottom-up changes inthe urban energy system.

In addressing bottom-up changes and transforma-tion of the energy system, a short analysis of existingurban planning and the different roles of the respec-tive actors is valuable (Jonsson 2011). Currently,urban planning processes are mostly closed and basedon rationality and power (Kuronen et al. 2010;Majamaa 2008; Mäntysalo 2002). In traditional urbanplanning processes, a top down approach is morecommon than an interactive development of urban orrural areas and a shared idea generation. Kuronen etal. (2010), Majamaa (2008) and Väyrynen (2007)describe the roles of the three different actors likepublic, private and people in the traditional planningprocess as following: Public as a municipality definesand develops urban planning and infrastructuresystems, e.g. by controlling the input flows (energyand water). The privates as developers design thederegulated areas as well as new technologies andbring new ideas into the market; they lunch innova-tion and conduct projects, whereas the people as endusers of the system use energy and the givenstructure. Both, private and people produce wasteand generate emissions. However, as companies andcitizens have only limited influence on the decision-making processes in the traditional way of urbandevelopment, a more interactive approach is neces-sary to address all challenges with respect to climatechange and energy efficiency. This can also bejustified by the fact that urban planning has a stronginfluence on the energy system design and its finalrealisation, but the systems definitions are set in theongoing planning process, whereas political decisionsare often made before planning or change within theplanning process (Lahti et al. 2006).

Kuronen et al. (2010) stress the public–private–people partnership (4P) model as an interactive urbanplanning process to reduce carbon dioxide emissions.According to the authors, the private sector has anactive role in the planning process and the way offinancing projects. They argue that within the coop-eration between the public and private, the costs ofplanning can be shared. In the research of Majamaa(2008), the private sector is thus often responsible forthe planning material needed and background studiesrelated to planning. Citizens can take part as urbandevelopers, e.g. to foster specific activities in theirliving surroundings. The municipalities mainly con-duct the process. Depending on the specific topic andas planning processes differ by planning cultures,

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municipalities departments, legislation and marketsituation ongoing or ad hoc integration can be useful.This goes in line with Agger and Löfgren (2008) whostate that concerted urban planning means governingnetworks and partnerships. However, which role doopen innovation and their respective tools play in thecontext of interactive urban planning and how canthey accelerate bottom-up changes in the energysector?

Open innovation

Nonmarket strategies of business are central elementsof successful and superior sustainability performance(Crane and Matten 2004; Baron 1995). Open innova-tion can be one of these elements. Open innovation isa process that combines external and internal com-petences within the innovation process by usingdifferent tools (e.g. innovation workshops and ideacontests). User integration means including futurecustomers and users in the innovation process on atargeted basis—from the initial idea all the way to theinnovation’s introduction and diffusion in the market-place. User integration in innovation processes andcommunity-based innovation can enhance awarenessof products and increase their acceptance among abroader public (Caird et al. 2008; Piller and Walcher2006; Franke and Shah 2003). Asking future usersabout their needs and taking these needs and thecircles that will eventually use the particular innova-tion into consideration at an early stage increases thelikelihood that the final product will be accepted andsuccessfully spread in the marketplace (Prahalad andRamaswamy 2004). However, innovation processesare non-linear decision processes that are accompa-nied by barriers and rebound effects. Focusing on theprocedural aspects of innovation processes, participa-tion can enable revealing barriers or specific users’demands or generating new knowledge. Participationis a broadly accepted sustainability criterion, and atthe same time, it is often a crucial condition to reachsustainability goals (OECD 2009).

At present, there is no generally accepted frame-work of user or customer integration. However, userinvolvement and interaction in innovation processescan be distinguished (Lüthje and Herstatt 2004).According to this differentiation, it is important todistinguish between who is working together and how

deeply customers are integrated into the innovationprocesses. The level of integration reflects the degreeof a user’s or customer’s deep and comprehensiveinvolvement into the innovation process. The level ofinteraction represents the degree of collaboration withother users or companies’ representatives and thepossibility of having influence on contents andprocess development. In addition, open innovationprocesses distinguish between a passive (taking partin co-creation processes) and an active role ofcompanies (initiating and conducting open innovationprocesses). In our assessment of recent OI processes,like ideas competitions and workshops, we realised ahigh level of interaction and integration. OITs are allmethods that go beyond the traditional way ofinnovating and show a high level of integration andinteraction. Realising open innovation workshops,focus groups, communities, ideas competitions, tool-kits or dialogues are part of the OIT. Among thesemethods, ideas competitions and innovation work-shops have evolved as major tools to generate anddevelop ideas in product innovation processes(Ogawa and Piller 2006; Piller and Walcher 2006;Piller et al. 2004) and were also used in our cases.

& Ideas competition is a forum in which personswith a special interest in the topic can generateand hand in creative ideas or concepts with regardto a certain topic defined by an organiser, e.g. thecompany (Piller and Walcher 2006).

& Innovation workshops are interactive meetingsthat provide a practical framework and structuredapproach for generating and discussing sustain-able solutions that generate breakthrough results(Arnold 2010).

However, these tools are not useful in all industriesor fields of activities and in each phase of theinnovation process (Prahalad and Ramaswamy2004). To overcome these limitations, the openinnovations approach in the field of mobility andhousing that we propose in this paper is to apply ideascompetition in an early phase of idea generation andemploy innovation workshops with so-called leadusers to develop selected ideas further. The so-calledlead users are a vital source of innovation (von Hippel2005; 1986). Lead users are persons that have manyideas for new product innovation and the ability toimprove products or service innovations or developinnovations ‘months or years before the bulk of that


marketplace encounters them’ (von Hippel 1986, p.796). This ability should be used by companies oreven in urban planning processes to innovate moresuccessfully. With respect to energy efficiency andsustainability, lead users are persons who compass,e.g. needs with respect to energy-efficient and/orsustainable concepts or activities, have a high degreeof experience and knowledge regarding energyefficiency and/or sustainability issues, and are stronglyinvolved in these topics—either by working or otheractivities.

Case study and method

Combining the innovative power of ideas compet-itions with the product development abilities of leadusers, a combination of both methods appears to bethe next step in developing OIT further. This might beuseful in particular in the context of urban energyefficiency, where a large number of ideas andmeasures are needed to achieve substantial advances,while the selection and implementation often requireexpert-like knowledge and experience. We thuspropose a two-step approach, where in a first stepideas are generated in an ideas competition that isopen to everyone. As a second step, the best ideasfrom that contest are then developed further ininnovation workshops. The selected ideas weredeveloped further by lead user workshops and focusgroup discussions. Participants of both workshopsare experts from science, practice, municipalityrepresentatives and lead users selected among theparticipants of the ideas competition and relatedinternet communities. The target of these work-shops was to develop the ideas into realisableservice and product concepts, having a strongimpact on energy efficiency, that can be applied

by the project’s praxis partners or other companies.This paper describes our experiences and findingsfrom applying the first step of this methodology tothe following three test cases (see Table 1):

& Ideas competition 1 was carried out as part of theproject ‘Open innovation processes for theenergy-efficient city 2020+’ (OFFIES 2020+).The aim was to apply OIT to collect and furtherdevelop ideas to improve the efficiency of energyuse within the city of Munich. This city had beenchosen due to successful previous projects withsome of the praxis partners and the politicalsupport for the project by the municipality andits administration. Munich has 1.3 million inhab-itants and is the capital of the Federal State ofBavaria. Its industry comprises vehicle and engineconstruction, software development, biotechnolo-gy and tourism. Munich is an important transitstation for traffic going to Italy and SoutheastEurope. The aim of the ideas competition was togenerate ideas improving the energy efficiency ofproducts and services in the field of mobility,housing and their integration. The online ideascompetition was implemented via an internet-based ideas competition platform at http://www.save-our-energy.de.

& Ideas competition 2 was part of the scientificproject User Integration (‘Fostering SustainableConsumption by Integrating Users into Sustain-ability Innovations’). The aim of this competitionwas to generate and design future forms of energyefficient and sustainable mobility, or the creationof intermodal, sustainable systems. These shouldcontribute to an improvement of sustainability, areduction in transition time and barriers, andinclude sustainable individual transport solutions.The contest was conducted in cooperation withthe Munich service company for public transport

Table 1 Characteristics of the ideas competitions in the OFFIES 2020+ and User Integration projects

Ideascompetition

Activity fields Themes Duration Submitted ideas

Ideas com-petition 1

Mobility, housing, mobilityand housing integrated

Service and product innovationsregarding energy efficiency

1 September 2009–16 November 2009

162 submitted (housing 60, mobility63, integration 39) 162 evaluated


Mobility Innovations and improvementsregarding sustainability

6 October 2008–31 December 2008

23 submitted, 23 evaluated


Housing Strategies and improvementsregarding sustainability

07 May 2009–02 June 2009

8 submitted, 8 evaluated


http://www.save-our-energy.de

http://www.save-our-energy.de

(MVV). The MVV is the central managementorganisation for public transport in Munich and itssurrounding areas. Ideas collection was done viaan internet-based ideas competition platform ofthe MVV.

& Ideas competition 3 was also part of the UserIntegration project. The aim of this competitionwas to generate energy efficient and sustainablepossibilities of house concept differentiationfocusing directly on users’ needs and demands(product and price policies) as well as thedevelopment of innovative promotion concepts(distribution and communication policies) thatcorrespond to inhabitants’ expectations and arein line with sustainability development. Theideas competition was conducted in cooperationwith a medium-sized construction and apart-ment management company in the field ofhousing.

The primary target groups of these online contestswere users and citizens in all German-speakingcountries. To communicate the ideas contests, weused the following marketing activities:

& E-mailing within the researchers’ community,& Implementing on the partners’ web pages,& Online blogs and communities focussing on the

related topics and& Newspaper.

Ideas competition 1 was also advertised by mail-ings to Munich schools. The best ideas were awardedprices like small consumer electronics, navigationsystems or weekend trips. The evaluation process of

the ideas contests was conducted in a five-stepprocedure as follows:

& Step1: selecting the main criteria and levels forinnovation,

& Step2: developing a measurement scale for therespective criteria,

& Step3: evaluation of all submitted ideas concerningtheir innovativeness,

& Step4: evaluation of all submitted ideas concerningtheir energy efficiency potential and

& Step5: analysing and interpreting the results.

In order to analyse the submitted ideas, we clusteredall ideas by specific criteria, such as the degree ofinnovation, need for behaviour-related changes, needfor governmental intervention, levels of realisation orrange of an innovation and the time horizon of apotential realisation (see Table 2). This evaluation of allideas was conducted by four scientific experts, at leastto put the results on a valid base.

& The degree of innovation is differentiated byits technical novelty. Discussing novelty opensa wide scientific field (Porter 1986; Tushmanand Anderson 1986; Abernathy and Clark1985; Abernathy and Utterback 1978). To keepour analysis simple, we disregard the intra-organisational aspects such as the knowledge andresources involved. Instead, we take an ‘external’point of view and focus on technological changesand the impact upon market competitiveness. Inthis sense, incremental innovations (value=1)absorb modest technological changes and theexisting products on the market can remain

Table 2 Category raster used to assess the ideas from the ideas contests

Innovation level Degree ofinnovation(0–3)

Need for behaviour-related changes (0–2)

Need forgovernmentalintervention (0–2)

Levels of realisation/spatial range ofinnovation (0–3)

Time horizonof a potentialrealisation (0–3)

Marginal change 0 – – – –

Incremental technical improvement 1–2 0 0–2 0–3 0–2

Behaviour-related innovation 1 1–2 0–2 0–3 0–3

Small-scale medium innovation 2–3 1–2 in either of the two categories 0–1 0–2

Large-scale medium innovation 2–3 1–2 in either of the two categories 2–3 2–3

Radical innovation 3 2 in either of the two categories 0–3 2–3

See text for an explanation of the figure ranges


competitive, whereas radical innovations (value=3)show large technological leaps. Medium innova-tions are in-between (value=2), marginal changesare assigned to a value=0. As an example, the ideaon car sharing in apartment buildings was evaluatedby 0 as the technology already exists and has to beimplemented, whereas LED lights as standard forstreet lighting was measured by 2 becausethere are several technical issues to be adoptedand it is a new idea.

& Behavioural changes in respect of climate changeand energy consumption are widely discussed(Stephenson et al. 2010; Biggart and Lutzenhiser2007; Wilk 2002). As human behaviour can havea strong influence on energy consumption as wellas energy production, the ideas should be evalu-ated in this category as well. The need forbehaviour-related changes implies the necessityfor behavioural changes that go along with theidea. This item distinguishes between no changesnecessary while using or implementing die idea(=0), some, but no elementary changes necessary(=1), elementary changes necessary (=2). The ideaon energy generation by using a keyboard wasevaluated by 0 as there are no behavioural-relatedchanges necessary; whereas establishing multi-storey bicycle parks people have to change theirbehaviour in order to use it (2).

& Changes in energy efficiency and energy consump-tion are difficult to realise, and inefficient practicesin the energy system are rather resistant to transfor-mation activities as well. Thus, government isalways present in setting targets and implementingregulations to increase energy efficiency in allbusiness sectors as well as concerning consumerbehaviour (Kern and Smith 2008). The need forgovernmental action is assessed similarly from 0to 2. Warm water connection for washingmachines would need new regulations, thusassessed by 2. A central switcher for regulationstandby devices would not need any governmentalactivity, thus 0.

& Energy systems are operating at different realisa-tion levels meaning they affect households orcities as a whole (Biggart and Lutzenhiser 2007).The level of realisation distinguishes four values,0=nano level (activity is realized individually ineach household); 1=micro level (activity com-bines more households, e.g. block of flats and

streets); 2=meso level (activity bundles severalmicro units, e.g. district) and 3=macro level(activity extends to the whole city and urbanhinterland). Green energy shops would have aneffect on macro level. An energy demand displayis realised on a nano level, e.g. household.

& In implementing energy systems or respectiveelements and ideas, the realisation of the plansand ideas will take time differently. The timehorizon addresses the time span in which the ideacan be realized or takes effect. This item differsbetween 0=immediately; 1=short-term (1 to2 years); 2=mid-term (3 to 5 years) and 3=long-term (more than 5 years). Looking for a parkinglot supported by GPS technology could berealised within 3 to 5 years as there are adoptionsin cars, car parks, satnavs, etc. in the whole urbansystem would be necessary. Switching off moretraffic lights during nights could be realisedimmediately.

To be evaluated as a marginal innovation, the ideais only characterised by 0 point in the first category.Whereas to obtain a status of ‘radical innovation’, anidea has to be evaluated by 3 points in the firstcategory and by 2 points in either of the followingtwo categories, such as need for behaviour-relatedchanges or need for governmental intervention, and 2or 3 points in the time horizon category. The level ofrealisation/spatial range of innovation could beevaluated from 0 to 3 points as the realisation ofradical innovations can differ depending on howdifferent technology and service conditions (changesin infrastructure and utilisation) from current circum-stances are.

The potential to improve energy efficiency andreduce carbon dioxide (CO2) emissions were rated bythree scientific experts. The evaluation of ideas withrespect to energy efficiency and CO2 emissions wasdone by a life cycle analysis (LCA) and literaturereviews. Where applicable, the LCA software Eco-Class has been used (Barth et al. 2007). Ideas thatwere not covered by EcoClass had to be assessedusing various sources. In case of a vague descriptionof ideas, the assessments were mapped as a probablescenario of the associated energy usage and CO2

emissions. The energy efficiency potential was clas-sified to have no potential for energy efficiencyimprovement compared to the respective current


states (value=0, <10% energy savings, e.g. fosteringtelework), or to have small (1, 10–35% energysavings, e.g. bicycle transportation by bus instead ofusing cars), medium (2, 35–70% energy savings, e.g.straight-through underground goods logistics) or bigpotential (3, >70% energy savings, e.g. sustainableurban mobility concept based completely on renew-able mobility for transportation energy in urban andsuburban areas).

Based on the evaluation of all ideas in average threeto four ideas, that have a high energy efficiency potentialfrom at least 1, were selected for further development inthe lead user workshops and focus groups. Lead usersand company representatives were participants in thelead user workshops. Focus groups were conducted bymunicipality and companies’ representatives as well aslead users. The final ideas were presented to theinvolved companies and municipality representativesfor realisation and further development.

Results and findings

We present our assessment of the ideas generated bythe three ideas competitions with respect to the sixinnovation categories. Figure 1 shows the distributionof all 193 ideas, which features a clear predominanceof ideas that require only small changes, while moreradical ideas are rare. All ideas are indicated in thelast column in Fig. 2. This general picture is repeatedwith variations when we distinguish between ideasrelated to mobility, housing and integrating ideas(Fig. 2). The differences appear in the relative size ofincremental technical improvements and behaviour-

related innovations. For mobility and housing, thesetwo categories together contain more ideas than the‘marginal change’ category. Note that ideas competi-tion 2 was conducted in cooperation with the localpublic transport provider, which might cause a biastowards behaviour-related innovations. On the otherhand, ‘marginal change’ is the predominant innova-tion pattern for ideas that aim at integrating housingand mobility. Apparently, integrating is much morechallenging than looking at housing or mobility alone,so that only less innovative ideas were developed andsubmitted. This result also reflects the lack ofintegrative solutions that already exist in urbanplanning and mobility concepts—people are still notused to think across system boundaries.

In a second step of our analysis, we put the degreeof innovation in relation to the potential for energyefficiency improvements. Figure 2 shows the averagepotential for energy efficiency improvement of allideas that fall into a given innovation category. Whilethis graph generally confirms the intuitive idea thatthe potential for energy efficiency improvementshould increase when innovation becomes moreradical, the increase is not as strong as one mightexpect. In fact, the average efficiency potential ofa marginal change idea is only half the potentialof an idea proposing radical change. More pre-cisely, the average potential of a marginal changeidea is still less than ‘small’, while for an averageradical idea, the potential is between ‘small’ and‘medium’. This is a consequence of the fact thatonly two ideas within the whole sample clearlyoffered a ‘high’ potential for energy efficiencyimprovements. Therefore, even though a fair

Fig. 1 Distribution of ideaswith respect to innovationcategory (housing n=68,mobility n=86 andintegration n=39) andof all ideas indicated inthe last column (n=193)


number of ideas scored ‘medium’, the averageswould even have less than ‘medium’ potential.

On one hand, this means that even the marginallyinnovative ideas may help to improve energy effi-ciency and should thus not only be discarded becauseof their limited innovativeness. On the other hand,one must take care not to draw the conclusion thatimplementing many ‘marginal change’ ideas couldalready offset the failure to develop and implementradical changes. The problem is that many ‘marginalchange’ ideas only affect minor shares of total energyconsumption so that even widespread implementationonly has a small effect on overall energy use. Largeenergy consumers like certain companies or publictransport systems, where even small improvementshave already a significant effect on overall energyuse, are often only affected by radical changes to thesystem as a whole.

A second feature in Fig. 2 that should also be notedis the high improvement potential of behaviour-

related innovations, which comes close to that of‘radical change’ ideas. This highlights the importanceand effectiveness to address and change behaviouralpatterns of energy use in order to save energy.However, this does not only include simple energy-saving measures (‘switch off the lights’) but rathercomprises advanced lifestyle and consumption pat-terns like car sharing, modal split changes orcommunity-oriented housing.

The effectiveness of behaviour-related innova-tions with respect to improving energy efficiencyis also apparent from the above graphs (Figs. 2and 3), which show the relation of innovativeness ofideas and energy efficiency improvement brokendown for the three fields of our study. Note that inthese graphs the energy efficiency potential of themedium and radical innovations is strongly affectedby the small number of ideas in these three categories(see Fig. 1), which must therefore be treated withcaution.

Fig. 2 Average potentialfor energy efficiencyimprovement forall fields

Fig. 3 Average potentialfor energy efficiencyimprovement for ideas inthe respective area(housing, mobility andintegration)


Discussion

Even though it might come as a surprise thatanonymous internet users did not submit more radicaland utopian ideas, this is quite understandable for fourreasons:

& First, it is generally easier to identify isolatedproblems and to invent a fix only for that than tofind a general pattern behind a number ofproblems and change that pattern. In other words,it is generally easier to treat symptoms than toheal a disease, which requires intensive thoughtsand effort, and thorough understanding of theunderlying system, and is thus harder to achieve.

& Second, most submissions were clearly related topeople’s everyday life. The resulting ideas thusdescribed minor technical fixes and smallerchanges in behaviour, as this is the field of actionfor ‘ordinary’ people. In addition, the gainedresults meet the distribution of the innovativenessof ideas in other business fields as well, such asideas contests in the food sector or in sports.

& A third reason is related to the setup of the ideascompetitions, which was looking for ideas thatcould be developed further by partner companiesand the help of municipality within a few years.Since implementing radical ideas generallyrequires large system changes and long time-scales, this setup decision generated a biastowards less radical innovations. In addition, ideasthat could be realised by ‘privates’ will not bespread into such community—as the private mightlose market opportunities because their ideas canbe adopted by several other companies. Moreover,we also assume some constraints regarding profitsharing, as it is difficult to assure a share in anidea’s profit.

& Fourth, as usual the participants of ideas contestsare citizens as well as some lead users. As thereare commonly only a few lead users among thebroad public or citizens, the distribution of ideasand their innovativeness go along with thecomparable contests and product development.Only a handful of ideas get a very creative orradical status.

Our data suggest a clear relationship between thelevel of the idea’s innovativeness and the energy-saving potential: on average, the more radical an idea

in our category is, the higher is its potential for energyefficiency improvement. The only exception isbehaviour-related innovations, which rank second inthe energy efficiency potential despite their below-average innovativeness. This finding puts a strongfocus on the importance of behaviour-related issuesfor energy improvements: First, these carry a greatpotential for efficiency improvements and should thusreceive more attention when discussing measures forenergy savings and climate protection. Second, theseissues offer huge opportunities to develop andimplement these via participative methods, bothwithin a corporate context and in the public andpolitical area. Users are able to bring new ideas andconcepts strongly related to energy system transfor-mation to the public as well as to the companies.

As urban planning processes and product orservice innovation focus on incremental improve-ments including behavioural changes as well asradical innovations and changes, we conclude fromthese findings that open innovation is a useful tool tointegrate the citizens’ ideas into new product andstrategy development. Urban planning processes andproduct or service development should be opened forcitizens’ and companies’ activities more often. Plan-ning and development processes can gain from thepeople’s ideas and foster sustainable change. Withrespect to carbon savings and sustainable develop-ment, citizens are able to develop and discuss energy-saving ideas and concepts, however, all ideas have tobe evaluated for their energy efficiency potential andsavings as well as their contribution to a sustainabledevelopment by experts before integrating or diffus-ing them in society.

In accordance to open corporate developmentprocesses to generate new innovations, urban plan-ning processes should also be conducted in a moreinteractive way as recommended by Kuronen et al.(2010). Based on the 4P model (Kuronen et al. 2010),our findings and our experience from the innovationworkshops, we present our idea of a concept for urbanopen innovation processes. Figure 4 contrasts thetraditional way and our idea of opening urbanplanning processes with respect to energy systembased on experiences made in the two researchprojects. In the context of the energy system, openinnovation addresses three different areas: (1) inter-active urban planning processes involving municipal-ity and company representatives as well as citizens or


lead users, (2) generating new solutions in the privatesector involving company representatives, municipal-ity representatives and/or citizens or lead users and (3)user-driven ideas directly to market launch.

In the first area, in accordance with Kuronen et al.(2010), the municipality opens closed planningprocesses to citizens and company representatives byusing several tools such as contests, surveys, round-tables, workshops, etc. to discuss the development ofthe energy system and possible solutions. There areformal and informal relations given between therespective market actors (Kuronen et al. 2010). As astarting point, we suggest the ad hoc integration ofdifferent actors and the development of energysolutions. By integrating different actors, futureinterests and business options can be discussed andimplemented into the planning process in advance.Appropriate business solutions can have an influenceon ongoing planning decisions and legislation proce-dure. When opening urban processes by means ofopen innovation tools, the number of urban concepts,ideas and plans increases firstly, before in a secondstep realisable solutions can be selected and devel-oped further. However, using open innovation pro-cesses, there is also the possibility to retard decisions.With respect to sustainability, retarding decisions cansometimes be a good idea, at least to have timeanalysing the respective rebound effects and possible

impact (Oikonomou 2009). An ideas contest can be agood opportunity to get a bunch of ideas for furtherintegration, discussion and selection in an ongoingplanning process. Focus groups are helpful in order todiscuss new concepts and ideas from three differentperspectives: the planning side, the realisation sideand the usage side. In these workshops, groundedideas for potential realisation can be developed.Therefore, open planning processes can be seen asgovernance processes concerning flows within adeveloping urban system as well as discussing andnegotiating rebound effects (Oikonomou 2009).

The second option is the co-creation process in theprivate sector for developing specific business sol-utions in the energy sector. Ideas contests are anappropriate tool to generate ideas and concepts savingenergy in an incremental way, but also in a ground-breaking one. However, co-creation processes are alsouseful to analyse trends in the market and to createcompletely new business models or solutions. Thecombination of ideas contests and innovation work-shops is very fruitful as new arising ideas can bedeveloped further to an implementable stage. Inte-grating lead users in these workshops enables thedevelopment of realisable ideas and concepts in thefield of energy. In all three fields, new ideas withenergy efficiency potential were developed further. Inthe field of mobility, a Sustainable Urban Mobility

Ideas, plans, regulations

Urban departments

Open Innovation: ideas and solutions coming from both PRIVATE and USERS

Markets

Products and services

Su

stai

nab

ility

req

uir

emen

ts

Solutions

Conventional sequential urban planning process

DecisionsMunicipality sets plans, regulations and laws: Companies and networks establish:

Solutions Used by (end) users

Ideas, concepts

ongoing institutionalised opened urban planning process

Ad-hoc openedurban planning

process and selective

integration

Agenda = sustainable solutions compared to current state = competitive solutions compared to current state

= flow of information and pursued or realised concepts/solutions

Interactive opened urban planning process321

Open Innovation: ideas and solutions coming from both PRIVAVV TAA E and USERS

Fig. 4 Open innovation as a crucial tool in interactive opened urban planning processes (source: own illustration)


concept, including urban wide electric mobilityproduced by renewable, so to say an urban closed-loop system using renewable energy and measurableimprovements for the whole city, was developed. Inthe field of integration, smart grid solutions tointegrated e-cars as a car-sharing model in newhousing concepts were discussed. In the field ofhousing concepts for shared energy consumptioneither with neighbours or in quarters were designed,too. In practice, change agents belonging to bothinstitutions, a specific company and a member of themunicipality, or working at interfaces were mostcrucial for fostering and implementing realisablesolutions, such as electric mobility in the urbansystem.

In contrast to Kuronen et al. (2010), 4P process inwhich people or citizens have an active end user’srole in bringing new ideas and signals to planning andin which participation and user innovation are mainbuzzwords, people can also realise urban plans orfoster urban development themselves in our concept.New energy-saving solutions can also be launched bythe users themselves (Ürge-Vorsatz et al. 2009; Cairdet al. 2008) as a third option of open innovationprocesses to change and develop the urban energysystem. These are absolutely bottom-up-driven busi-ness solutions to change the urban energy system inan incremental way, like user-driven local smart gridsolutions or car-sharing models for elderly or sociallydisadvantaged people.

Conclusions

Given the challenges of sustainability and the need toconserve energy, improved energy efficiency is amajor issue for urban development. However, con-ventional urban planning processes are too linear anddo not provide enough room for interaction andfeedback by end users (customers and companies).Therefore, they often deliver less than optimal out-comes and solutions. Nevertheless, central urbanplanning is useful and desirable, e.g. for implement-ing a holistic energy transformation strategy andcoordinating respective activities. Yet, as user inno-vation and opening up urban planning processes arecurrent trends in innovation management or evenmore in academia (von Hippel 2005; 1986) and due tothe necessity of bottom-up changes, it is of crucial

importance to select creative users to develop strate-gies, concepts and innovations with citizens success-fully. The paper presented an enhanced approach andrelated the findings from recent open innovationexperiments to it.

Our empirical assessment of the ideas generated byideas competitions focusing on energy-efficient andclimate-friendly solutions in housing and mobilityshowed that there are a vast number of ideas availablein the public. Even though many of them wereconsidered to be only marginally innovative, themajority offered a medium to high degree ofinnovativeness, and could thus be considered forfurther elaboration. Some ideas even can be imple-mented by the users themselves and thus support thebottom-up changes directly.

The selection process that is required after collect-ing ideas from an ideas competition to identify ideasto be further elaborated is a useful mechanism toovercome one of the shortcomings of an OI approach,namely that the ecological benefits of the submittedideas are limited on average. Due to the lack of ideasthat clearly offered a high potential to improve energyefficiency, the reported average potentials were onlysmall. Nevertheless, when selecting ideas for furtherelaboration, care was taken to choose from those withthe highest rankings resulting in a much higheraverage potential within the selected subsample.

Currently, some of the ideas are actively beingdeveloped by partner companies. However, none ofthe selected ideas has evolved into a marketableproduct or service directly. Therefore, due to the lackof time in innovation processes, the commercialeffectiveness of our approach could not be tested sofar. Likewise, due to time constraints, the analysis ofthe effectiveness of the lead user workshops and thecombination are still under investigation and will bepresented in a future publication.

There is some evidence that OIT strengthenenergy-efficient activities—at least they raise energy-efficient issues. User integration in innovation pro-cesses and community-based innovation enhance anawareness of products and increase their acceptanceamong a broader public. Citizens’ integration canstrengthen economic responsibilities, meaning that thebasic obligations of business to produce goods andservices that society wants and to sell them at a profitare met (Freeman et al. 2010). Especially in (web)communities, dialogues and workshops on energy-


efficient solutions can be discussed and a highertransparency can be reached. Ideas competitions andworkshops encourage discussion and the selection ofenergy-efficient solutions. With regard to innovations,OITs allow a higher level of interaction and integra-tion, and therefore offer advanced possibilities togenerate energy-efficient solutions. Therefore, policyshould support the citizens’ ideas for energy efficien-cy solutions either by strengthening participatorypolicy instruments, such as multi-stakeholder dia-logues, or by local sustainability activities. As radicalinnovations often have to be supported by the state, apolicy should at least support further research orinvestigation of selected fruitful citizens’ ideas.

Acknowledgements The OFFIES 2020+ and the User Inte-gration projects have been generously funded by the GermanFederal Ministry for Education and Research. OFFIES 2020+was part of the research initiative ‘Fundamental ResearchEnergy 2020+’, while User Integration received funding fromthe programme on ‘Social–Ecological Research’.

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