The three-phases of research and engagement (2008–2023) of the ESRC-funded Centre for Climate Change Economics and Policy (CCCEP) ended in December 2023. All CCCEP publications are available on this legacy website. Any new outputs will be uploaded to the site between 2024 and 2028.

‘Demand pull’ government policies to support Product-Service System activity: The case of Energy Service Companies (ESCos) in the UK

Product-Service Systems (PSSs) constitute a family of service-based business models designed to satisfy our societal needs in an economically and environmentally sustainable manner. To date however PSS application has remained niche due to a variety of critical barriers. This paper explores how ‘demand pull’ national government policies could support PSS activity by addressing these barriers and cultivating market demand. Lessons are drawn from a case study of how regulatory, economic incentive, informative and procurement policies have supported Energy Service Company (ESCo) activity in the UK; a sub-set of the PSS family focused on energy service provision. Subsequently five policy recommendations are presented to support PSS activity: (1) balancing economic incentives and regulatory disincentives; (2) promoting indirect policy support; (3) redesigning existing market structures; (4) promoting locally-led PSS activity; and (5) creating stable policy frameworks. The paper warns however that national government policy cannot easily address all PSS barriers, such as customer preferences, international developments, technological progress and inherent business model weaknesses, pointing to the need for other complementary solutions. Furthermore, other governance actors beside national government could also implement PSS supporting policies.

Hannon MJ, Foxon TJ, Gale WF (2014), Journal of Cleaner Production.