The low-energy and the nearly zero-energy buildings trend is calling for radical new innovations from the construction industry. This study uses path creation theory to examine two innovation concepts for low-energy housing in Northern Europe with contrasting outcomes—with one being an apparent market success and the other a disappointment. The results highlight two issues behind the success, one of a systemic nature and the other concerning innovation management. First, the development of energy efficiency regulations and the dominant technological trajectory regarding low-energy houses are interdependent. However, it seems that while supporting the trajectory of the innovation developed in the first case, regulators created virtually insurmountable cognitive and normative obstacles to finding alternative technological pathways. Second, the significance of proof of concepts for new innovations cannot be underestimated. The importance of a pilot project rests not only on showcasing and testing the technology, but also on its ability to increase political support, investments, and public awareness. The study implies that low-energy construction seems to be the next great challenge, one where genuine co-operation between the industry, public authorities and academia is a prerequisite for success.
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