Regulatory capacity and knowledge brokers in the decarbonisation of electricity systems

Many governments aim to rapidly expand the share of wind and solar energy in electricity generation as part of broader efforts to mitigate climate change. Despite being increasingly cost competitive, their integration into electricity systems requires adjusting a governance system intended for other technologies. This study contends that in order to better address technical and political challenges, regulators need to access scarce specialist knowledge. Regulators’ access to such knowledge is dependent on brokerage, the strategic intermediation of actors in the industry, which can happen through different organisational arrangements. Power-generator and grid companies broker knowledge by providing expertise in ways that advance their own interests; whether that interest is to halt decarbonisation or capture the largest possible share of a growing renewable energy market. Independent system operators and expert organisations are alternatives for knowledge brokering that can be crucial to successful regulatory innovations. This research explores the mechanisms and significance of knowledge brokerage through the use of process tracing, network analysis and the controlled comparison of two liberalised electricity systems –Chile and the UK– and two state dominated systems –China and Mexico. Each pairwise comparison shows, independently, that knowledge brokers have become increasingly important in devising and deploying new market governance instruments that are relevant to renewable energy deployment. In liberal markets this is the result of a need to coordinate investment and create new market products. In state-dominated markets this is the result of a pursue to fragment and balance the influence of the state-owned grid and generation companies. The study shows that independent system operators and expert organisations can become substitutes, in terms of brokering specialised knowledge, but only as long as expert organisations are actively integrated in the regulatory process through delegation of crucial functions. This research slows programmatic alternative for developing regulatory capacity through building on the existing and potential competence of expert organisations and the system operator that exist in every electricity system.