Published on March 18, 2021

Can ‘policy co-design’ pave the way to a just transition? An Estonian example

by Silver Sillak

People in Ida-Virumaa, the Estonian region currently transitioning away from shale oil dependency, have been experimenting with ‘policy co-design’ as a way to come up with alternative plans for their region in a participatory manner. So what are the lessons learned from their experience?

All over Europe, regional governments are drawing up just transition plans to combat climate change and ensure regional development while safeguarding jobs and well-being. However, it is still not quite clear how to develop and design effective, efficient and socially acceptable policies for a just transition. Existing policies are commonly dominated by fragmented and short-term decisions, incremental change of existing regulations and political bargaining to satisfy the most vocal and powerful interest groups.

This has also been the case in the Ida-Virumaa region in Estonia, notable for the oil shale industry which contributes around two-thirds of all greenhouse gas emissions in the whole country. The region is a classic example of path dependence and fossil fuel lock-in which has made the energy transition in Estonia a hugely controversial process with very little progress so far.

What is ‘policy co-design’?

However, a more ambitious and collaborative wave of policy design is on the rise and offers a potential way forward in regional climate and energy policy-making. Policy co-design is ‘a design-led process, involving creative and participatory principles and tools to engage different kinds of people and knowledge in public problem solving’*.

In September 2020, a policy experiment was launched by the Association of Ida-Virumaa Municipalities, the Ida-Virumaa Enterprise Centre, the Estonian Fund for Nature, the Estonian Green Movement and the Estonian Environmental Law Centre, to co-design proposals for renewable energy and energy efficiency policy in the context of a just transition. The resulting policy proposals would contribute to the regional ‘green plan’ which would become part of the regional just transition plan. The experiment is the first of its kind in Estonia, a country that only 30 years ago belonged to the Soviet Union and therefore has a relatively short tradition of collaboration between the government and the civil society.

The social enterprises DD StratLab, Social Innovation Lab and the Institute of Baltic Studies were commissioned to lead and facilitate the policy co-design process. Altogether, over 30 organisations from national and local government, the renewable energy industry and NGOs were involved in the process.

Although the organisations were invited according to their influence on and interest in renewable energy and energy efficiency in the region, their recruitment and engagement proved somewhat difficult. This was due to time constraints and the mismatch between the initial expectations of the participants and the facilitators. However, the attention paid by the facilitators to listening and attending to the participants’ expectations enabled them to adjust the process design to the participants’ needs.

Lessons learned

For instance, it became clear early on that the participants didn’t have the amount of time available that the facilitators had initially planned. As a compromise with the participants, workshops that were supposed to last a whole day were shortened to three hours. This made the workshops more accessible to participants and enabled everyone to keep a sharper focus. The sense of purpose and unity created through the shared expectations kept motivation high throughout the process and improved the partnership between the environmental organisations, the renewable energy industry and the local government.

The recruitment of participants was followed by an introductory meeting, a vision-building workshop, eight policy design workshops, two extended network meetings and an impact assessment. The whole process took place fully online on Zoom and lasted from September to December 2020.

Throughout the process, the facilitators combined co-creation and design thinking methods. For the policy design workshops, which were at the heart of the process, the participants were divided into four thematic groups (wind and solar energy, energy efficiency and energy storage) with four to seven participants in each. Existing barriers to increased energy production, efficiency or storage were identified and possible solutions were brainstormed, from among which ‘core solutions’ were chosen.

For instance, the following core solutions were identified in the wind energy group: 1) introducing a support scheme for citizens’ energy co-operatives; 2) removing ‘phantom’ grid connections; 3) making new areas available for wind energy production; 4) making climate objectives binding for policymakers on all levels; 5) introducing local benefit schemes; and 6) promoting wind energy as the new narrative for Ida-Virumaa. In between the workshops, the participants worked independently on elaborating the proposals and describing their estimated impacts in more detail.

Overall, 18 policy proposals were developed. A preliminary impact assessment showed that their implementation would be beneficial for the environment, the economy and the welfare of local people.

Professionally facilitated mutual learning and dialogue were vital in the process, contributing to the emergence of new cross-cutting proposals such as the establishment of a local energy agency and the creation of a new green narrative for the region. The new solutions were balanced with well-known ideas, and the complementary effects between them point to a potentially effective policy mix.

For example, the establishment of a local energy agency would make it easier to offer consultation services and financial instruments for both wind and solar energy as well as energy efficiency and storage projects. In future co-design processes, even more emphasis should be put on identifying core problems through deep learning, developing potentially cross-cutting policy proposals and fine-tuning standalone proposals into a coherent policy mix.

All of these activities take a lot of time and make the policy process not very time efficient. On the other hand, the initial gains in time efficiency of conventional policy design approaches might prove counter-productive if they lead to policies that lack ambition, vision and transformative capacity or encounter major social resistance.

Policy makers’ unfamiliarity with the design of the process proved to be an issue. Several of them felt that co-design was something done merely because it was new and fun and therefore a waste of time, or they were simply not comfortable with participating in it. Shifts in role perception and institutions are therefore needed to increase the acceptability of co-design within policy circles.

On the other hand, the people who did decide to take part evaluated the process as a very positive experience and they appreciated the chance to enter into a constructive dialogue. They also said that they got a lot of new contacts and now knew who to turn to for help on specific topics. The participants felt that even though several proposals were already well-known ideas, their submission by a broad group of experts and other participants added legitimacy to them.

The experiment showed that policy co-design can create new partnerships and improve energy transition policies even in eastern European industrial regions characterised by fossil fuel lock-in and a lack of experience with collaborative democracy. However, the absence of several local municipalities as well as the oil shale industry from the process indicate that there is a long way to go to make co-design fully compatible with traditional public administration routines. There are signs that the incumbent industry still sees policy design as political bargaining to forge a winning ‘coalition’ rather than collective sense-making to reach shared meaning and consensus. It is therefore unclear to what extent new policies are able to alter the status quo – although there is cause for optimism.

As of January 2021, most of the policy proposals developed in Ida-Virumaa were included in the draft of the regional just transition plan which is set to be finalised and approved by the EU by September 2021. Slowly but surely, co-design is both supplementing and transforming the traditional ways of thinking about climate and energy policy.

*Blomkamp, E. (2018). The promise of co‐design for public policy. Australian Journal of Public Administration77(4), 729-743.