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University College London
This short brief highlights the divide between “sunset” and “sunrise” (declining and emerging) firms and their strategies when faced with decarbonisation pressure. Sunset industries are well-established firms managing large flows of financial and physical assets but also grapple with decline and the gradual de-valuation of their assets which can disrupt local and national economies. By contrast, sunrise industries are characterised by high innovation and growth potential but can fail to attract sustained investor interest, with the potential to disrupt market stability and create financial bubbles.
The energy transition is a multi-level, whole socio-technical transformation. This short report challenges the view of a rigid division between sunset and sunrise firms, showing how both types adopt varying strategies. Incumbents can drive sustainability and innovation, contributing to transitions. The evolving landscape demands a broader perspective and more comprehensive view of societal transformations for efficient industry policies.