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The Role of Pilot- and Demonstration Projects in Accelerating Hyperloop

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The Role of Pilot- and Demonstration Projects in Accelerating Hyperloop The Role of Pilot- and Demonstration Projects in Accelerating Hyperloop A MULTI-LEVEL PERSPECTIVE TOWARDS LARGE-SCALE TECHNOLOGICAL TRANSITIONS MAGLEV AS A CASE STUDY H.P. KOERKAMP MASTER OF SCIENCE IN MANAGEMENT OF TECHNOLOGY in collaboration with: The Role of Pilot- and Demonstration Projects in Accelerating Hyperloop A MULTI-LEVEL PERSPECTIVE TOWARDS LARGE-SCALE TECHNOLOGICAL TRANSITIONS MAGLEV AS A CASE STUDY Thesis Document by H.P. Koerkamp in partial fulfilment of the requirements for the degree of Master of Science in Management of Technology at the Delft University of Technology, to be defended in public on August 29th, 2019 Student Number: 4491718 Contact: [email protected] Project Duration: December 2018 until August 2019 Project Committee: Prof. Dr. G.P. van Wee TU Delft – Chair Dr. J.A. Annema TU Delft – 1st Supervisor Dr. G. van de Kaa TU Delft – 2nd Supervisor Ir. S.J. Marges Hardt Hyperloop – External Supervisor This master thesis document is confidential and cannot be made public until 29th August 2019. An electronic version of this thesis is available at the TU Delft Repository. "We may perhaps learn to deprive large masses of their gravity and give them absolute levity, for the sake of easy transport." - Benjamin Franklin, 1780 H.P. Koerkamp (2019) Acknowledgements In front of you lies the result of the research project that marks the final part of my master program Management of Technology and my time as being a student at the Delft University of Technology. The emergence of this thesis topic originates from my personal interest the contemporary transportation system at large and its urgent quest to become more sustainable in the nearby future. Along the project, my interest grew for the fascinating role that magnetic levitation transportation technologies, both maglev and hyperloop, could have in creating such a sustainable transportation system. As such, I feel grateful that I got the chance to work in collaboration a frontrunner in the high-tech hyperloop technology; Hardt Hyperloop. My passion for this field has been a constant source of curiosity, which in the end diverted me from the topic from time to time. Nevertheless, writing this thesis allowed me to apply the knowledge that I obtained throughout my years in Delft. In the end, I am confident that the result of this thesis would not have been possible without the help of some highly motivated persons. Therefore, I owe my gratitude to all that have contributed to the realization and attainment of my master thesis project. First of all, I would like to thank my external supervisor Stefan Marges. His valuable help, support and patient gave me crucial feedback and insights in the practical experiences of Hardt Hyperloop. Also, I would like to thank my first supervisor Jan Anne Annema. From the very first moment his effort helped me in formulating this fascinating topic and structuring this thesis document. Furthermore, to the chair of the graduation committee Bert van Wee and my second supervisor Geerten van der Kaa, thank you for your critical reflection and challenging questions. Lastly, I would like to thank the industry field experts that provided me with value information in reconstructing the storyline around magnetic levitation transportation technologies. It was not easy to reconstruct the complex historical narrative within the time constraints of this project, but it would not have been able at all without their support. I am sincerely looking forward to presenting my results on August 29th, 2019. Hidde Phillip Koerkamp Delft University of Technology, August 2019 1 H.P. Koerkamp (2019) Executive Summary Introduction – The transportation industry is one of the foundations of our modern-day economy. More recently, however, it has become apparent that the contemporary transportation system also has severe drawbacks related to increased air pollution, noise nuisance and traffic congestion. One possible way to address these concerns is to develop a new and advanced mode of transportation technologies that satisfies environmental compatibility through minimal carbon footprints on the one hand, while on the other hand accommodates future high-capacity and high-speed throughput. Magnetic levitation (maglev) was developed during the second half of twentieth century as a contactless transportation technology that levitates, accelerates, and decelerates a vehicle through forces generated by magnetic fields. Although technical and environmental potential were promising, the economic risks and uncertainties to the many stakeholders involved created barriers to successful breakthrough within the incumbent high-speed transportation regime based on conventional high-speed rail and air transportation. In more recent years, the hyperloop concept was revealed that constitutes a modern advanced maglev technology that is complemented by vehicles running through a low pressure environment. Although hyperloop could induce a large technological transition in the high-speed transportation regime, the development requires significant capital investments to exemplify the technical and economic principles successfully. In this context, the emerging hyperloop innovation system faces the same barriers towards successful commercialization. Although pilot- and demonstration projects are recognized for their central role in advancing new knowledge, surprisingly little academic research has been conducted that analyses the different roles of demonstration projects along different stages within emerging innovation systems. Research Design – Radical innovations often face a mismatch with established regimes. Especially in large technical systems, such as the transportation system, technological lock-in and path dependency related to the incumbent innovation systems raises barriers to successful breakthrough. Therefore, it is important to understand the build-up processes and their virtuous cycles necessary for emerging innovation systems to obtain enough momentum in order to break out of the niche level. The key within these motors of innovation may be found in the various roles of pilot- and demonstration projects. Although the importance of pilot- and demonstration projects in the innovation process has been illustrated, industry can hardly incur long-term costs for realizing large pilot- and demonstration projects. This difficult challenge together with uncertainty and risks may cause underinvestment at this critical stage in the development process and could ultimately lead to premature deaths of potentially promising technologies. The idea followed throughout this research is that radical innovations within large technical systems emerge within the context of innovation systems formed by networks of actors, institutions and technologies. The objective of this study is to explore the various roles of pilot- and demonstration projects in order to 2 H.P. Koerkamp (2019) accelerate technological innovation system dynamics that could lead to a take-off of the hyperloop technology. In order to fulfil the research objective, the following research question have been defined: How could pilot- and demonstration projects accelerate the motors of innovation during the formative stage of technological innovation systems to ultimately induce a large-scale technological transitions? In order to answer this question, the state-of-the-art literature is examined to conceptualize the role of pilot- and demonstration projects within emerging innovation systems and technological transitions. Secondly, an empirical case study on magnetic levitation transportation technologies is performed to empirically validate the theoretical framework. Finally, the theoretical- and empirical analysis are synthesized to answer the research questions and provide scientific- and practical recommendations. Theoretical Analysis – The current literature describes the ambiguous role of Pilot- and Demonstration Projects (PDP) through a number of different demonstration projects: lab-scale and industrial-scale demonstration projects primarily aimed at experimenting and reducing technical and preliminary economic uncertainty, and deployment- and auxiliary demonstration projects aimed at exemplifying the technology for commercial purposes. Secondly, the literature on Technological Innovation Systems (TIS) argues that innovation systems emerge during the formative stage through a set underlying build-up processes, labelled as the seven Functions of Innovation Systems (FIS); entrepreneurial activity, knowledge development, knowledge diffusion, guidance of the search, market formation, resource allocation and advocacy coalitions. following the concept of cumulative causation, system functions interact and reinforce each other over time. A set of four characteristic virtuous cycles are labelled as the motors of innovation; the science- and technology push motor, the entrepreneurial motor, the system building motor and the market motor. Third, the literature on Technological Transitions (TT) stresses that successful transitions are the result of processes linking up at three levels, the landscape developments, the socio-technical regime, and the technological niche. The theoretical analysis is concluded by proposing a theoretical framework that explicitly emphasized the roles of pilot- and demonstration projects through an added function labelled as “Pilot- and Demonstration Projects”. Empirical Analysis – The multi-level perspective is taken as a lens to explore how the Magnetic Levitation Transportation
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