Economics at your fingertips  

Multinational energy utilities in the energy transition: A configurational study of the drivers of FDI in renewables

Samuli Patala (), Jouni K. Juntunen, Sarianna Lundan and Tiina Ritvala
Additional contact information
Samuli Patala: Aalto University
Jouni K. Juntunen: Aalto University
Sarianna Lundan: Aalto University
Tiina Ritvala: Aalto University

Journal of International Business Studies, 2021, vol. 52, issue 5, No 8, 930-950

Abstract: Abstract The global energy system has a long way to go to meet international climate goals, and significant investment in renewable energy is required to accelerate the energy transition (IRENA, 2016, 2019). We examine how firm- and country-specific conditions in the electric utility sector impact foreign direct investment (FDI) in renewables. Using a unique dataset of 289 greenfield investments by 17 multinational energy utilities, we employ a fuzzy set qualitative comparative analysis (fsQCA) that yields five causal configurations leading to FDI in renewables and four configurations leading to investment in non-renewables. Our results indicate that private MNEs are at the forefront of investment in renewables, and while state-owned MNEs (SOMNEs) do invest in them, they tend to follow strategies that are less risky compared to private MNEs and more responsive to host-country incentives. Our analysis suggests that for private MNEs, international experience is strongly associated with investment in renewables, while for SOMNEs it is associated with investment in non-renewables. Further, we also identify instances where MNEs contribute simultaneously to a ‘race to the top’ and a ‘race to the bottom’ by investing in both renewables and non-renewables in different markets, thereby reducing the pace of the energy transition.

Keywords: energy transition; pollution havens; FSA-CSA matrix; FDI; incentives; state-owned enterprises (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.springer. ... nt/journal/41267/PS2

DOI: 10.1057/s41267-020-00387-x

Access Statistics for this article

Journal of International Business Studies is currently edited by John Cantwell

More articles in Journal of International Business Studies from Palgrave Macmillan, Academy of International Business
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

Page updated 2021-06-26
Handle: RePEc:pal:jintbs:v:52:y:2021:i:5:d:10.1057_s41267-020-00387-x