Most countries in Europe have set targets to reduce carbon emissions and increase energy efficiency. In these countries, renewable energy from micro‐generation technology (MGT) is an important part of the low carbon agenda. Little is known about the decision‐making processes around the selection and adoption of such technologies, or about the actual effects of particular policy instruments encouraging their use. In this chapter, a simple illustration based on a single case study is used to show that innovation triggered by regulation, in this case the adoption of MGT, often has outcomes that do not reflect ultimate policy objectives in an effective way. The adoption of MGTs happens through a recursive process of interest articulation and negotiations. The outcome – the innovation – can end up being a compromise that only partially fulfil needs of stakeholders, but do not address ultimate policy objectives.