Systemic innovation

Optimising the synergies between innovations in all components of the system (technology, business models, market design, system operation) makes smart on-the-ground solutions possible.


Innovation is the engine powering the global energy transformation. It is not implemented in isolation and it embraces more than just technology. Innovation is needed in market design, system operation and business models to successfully enable power sector transformation, and ultimately the energy transition. Innovative solutions emerge from matching and maximising synergies between various innovations across multiple components of the power system. This is called systemic innovation.

Systemic innovation is key in every transformation. It enables a high level of flexibility in the power system to integrate a high share of variable renewable generation, and can also enable smart electrification of end-use sectors, such as the mobility sector and the heating and cooling sector.

Systemic innovation involves progress across all actors, from technology providers and entrepreneurs to regulators, energy planners and system operators, and to consumers themselves. The priority lies in having the necessary technology available, adopting a defined regulatory framework to send the right signals to market players, and accounting for innovation in the system’s planning stage, while also enabling innovative business models to capture the value from smart electrification strategies.


IRENA has developed the most comprehensive innovation toolbox available for countries to implement solutions that increase the flexibility of their power systems. IRENA’s Innovation Landscape for a Renewable-Powered Future report provides first-of-its-kind mapping and categorising of emerging innovations from across the world, illustrating how systemic innovation facilitates higher shares of variable renewables in the power sector.