Regulatory state capacity for accelerating net-zero transitions: Lessons learned from governing electricity storage in Germany

Policy implications arising from the unique challenges in the acceleration phase of net-zero transitions are receiving increasing attention. As a refinement, this paper focusses on regulation as a subset of policies and investigates the regulatory implications of such acceleration challenges. We integrate the literature on transformative policy capacity for conceptualising regulatory state capacity needed for responding to these challenges through regulatory change. This regulatory state capacity is operationalised by means of roles, abilities and resources. We apply our analytical framework to the market for electricity storage systems in Germany. Based on in-depth interviews and participant observation we find a high institutionalisation and complexity of regulation, and an accelerating effect of multi-system interactions on and contestation around regulatory changes. Our research reveals that in Germany regulatory state capacity has been characterised by a high relevance of gatekeeping and moderating as well as political abilities in light of the challenges ‘whole system change’ and ‘expansion and contestation’. We further observe a change in roles, from a maintaining to a creating character, and different sources of more radical regulatory change: while the changing attitude towards residential storage in the regulatory agency is based on learning and reflexivity due to its role as observer, warner and mitigator embedded in a changing socio-technical environment, the changing regulatory state capacity in the investigated ministry is triggered by the change of government and the associated stronger political will from inside the organisation itself. In conclusion, the article provides recommendations for policy makers with a focus on regulation.