There are several approaches to stimulating innovation. Drivers for eco-innovation are changes in the external environment, such as the implementation of new regulations, the change in consumer preference or technological advantages (Hermann & Wigger 2017). Nevertheless, this study will focus on some of the key drivers which are vital for achieving eco-innovations and they will be regarded in the maritime industry and ballast water management. These drivers include technological push, market pull, and regulatory push (Hermann & Wigger 2017) which are presented in figure 6.
Figure 6 Drivers for cleantech in the maritime industry
Regulatory push
Regulatory frameworks are generally seen as one of the main drivers of environmental technology adoption (Montalvo 2008). The term regulatory push contains variety of policy instruments that work as market-based instruments: taxes and tradable permits, standards, negotiated agreements, and information-based instruments, i.e., the eco-label. (Hermann & Wigger 2017) Regulations stimulate firms to improve their existing processes, products, and services as well as develop new ones (Rennings & Rammer 2011).
Development of cleantech
in the maritime
industry Regulatory
push
Technological push
Market pull
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Maritime industry has the most regulations compared to other industries (Pitana &
Handani 2020) and these environmental regulations and development of required technologies are rapidly changing the operating environment (Kilpi et al. 2021). Over the last century a regulatory system that covers all aspects of shipping business has evolved. Subject to regulation in one way or another are ship design, maintenance standards, crewing costs, employment conditions, operating systems, company overheads, taxation, oil pollution liability, environmental emissions, and cartels.
(Stopford 2008) In addition, environment, emissions by ships, ballast water, and ship recycling have all received more attention over the past years. New environmental regulations put significant investment pressure on the maritime industry as well as forces maritime clusters to invest in cleantech development. (Mäkinen & Laaksonen 2014) Knowledge of maritime regulation is essential as regulation has an important part of the maritime industry and it has economic consequences. According to Andersen et al. (2013) the ongoing changes in international and national maritime legislation are in many cases the main strategic concern for maritime companies.
The new regulations cause a change in business culture and new business routines in the companies working in the maritime industry. Consequently, changes have resulted in additional costs for shipowners or operators such as infrastructure and technologies, R&D and education, international networking, and national strategies (Mäkinen & Laaksonen 2014). These costs are included in the implementation costs to meet regulatory requirements. As a result, shipowners typically face the risk of a conflict of interest between consumers and their market share. (Pitana & Handani 2020) However, the regulatory changes lead to direct environmental benefits and such advances may eventually result in first-mover advantages in global competition in maritime cleantech (Mäkinen & Laaksonen 2014).
Like earlier mentioned, the BWM Convention is regarded as the first significant legislation adopted to control and eliminate environment and health issues from the transfer of invasive species. Additionally, USCG has its own BWM regulation for ships operating in the U.S. waters. These regulations include specific requirements that demand every vessel to treat its ballast water with appropriate treatment
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systems. Regulations have an influential impact on the BWTS market as it is dependent on international regulations, technical standards, and national implementation programmes (King et al. 2012).
Market pull
Market pull includes factors such as customer demand for greener products or production processes, a firm’s image linked to environmental protection, improved competition by the reduction of costs, and the creation of new markets (Hermann &
Wigger 2017). Market-pull innovations are triggered by new or previously unknown needs (Bucherer et al. 2012) or pressures from customers and the larger public (Montalvo 2008).
The BWTS’ market demand on a global level has been established due to the BWM Convention. Additionally, there has been ongoing discussion within the maritime industry for solutions that reduce the impact of shipping on environment like BWTS (Koukaki & Tei 2020). Thus, maritime companies are influenced to invest in cleantech to satisfy customer demand as well as remain competitive in the market.
Hence, market pull has had an impact on the growth of the BWTS market. However, the BWTS market size and timing are more dependent on international regulations, technical standards, and national implementation programmes (King et al. 2012).
The demand for the BWTS has been already set as the BWM Convention was approved in 2004 and enforced in 2017, and as a result, new builds need to have BWTS installed, however existing vessels have time until 2024 for retrofitting BWTS (Makkonen & Inkinen 2021). Thus, the demand for BWTS will drastically increase when regulation’s deadline approaches in 2024.
There has been delay on the ratification of the BWM Convention by the IMO member nations because they wanted to delay the enforcement of the convention until they are sure that sufficient systems have been fully developed and supplied into the market. Consequently, the delay had a major set-back in affecting the demand of customers and growth of global market. BWTS Manufacturers, potential investors,
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and shipowners have been waiting for assurances from regulators before investing on the treatment systems. (King et al. 2012)
Technological push
Technological push concerns the supply side embedded knowledge that is in machines, human capital, and organizations. Technological push has two effects: it reduces manufacturing costs in the production processes, and it commercializes a greener product. This means improvements in product’s quality and in the production process by cutting costs of material and energy. (Hermann & Wigger 2017) Technology-push innovations are triggered by the usage of new technologies and are driven mainly by R&D (Bucherer et al. 2012).
In the maritime industry, most companies adopt environmental technologies to reduce environmental impact as well as to meet up with strict environmental regulations and increasing pressure to adopt to eco-innovative practices. These developments towards stricter environmental regulations require the development and installation of new technologies. (Andersen et al. 2013) BWTS is a new technology and its developments’ overall intention is to reduce environmental impacts by preventing the negative impacts of invasive species. The technology is an “end-of-pipe” solution since it deals with the symptoms but not the cause of the problems related to the use of ballast water. (Makkonen & Inkinen 2021) Like mentioned before, there was a delay in the ratification of the BWM Convention which caused the market to experience a slow development of ballast water treatment technologies (King et al. 2012).
35 4 RESEARCH DESIGN AND METHODS
This chapter consist of the research design and methodology. It begins with explaining the research design, after that it presents how the data was selected and collected. It also discusses the data analysis. Finally, a critical analysis of reliability and validity is presented.