| Summary: | The public sector plays a pivotal role in setting the pace for climate action innovation through policy development and inter-organization collaborations for sustainable energy solutions. There is generally a lack of a proper understanding of innovation in the public sector compared to the private sector, with the public sector being considered slow, bureaucratic adopters of innovation. This study investigated the understanding and approach to innovation in public energy organizations, determining if and how these organizations innovate and their ability to innovate, especially towards climate action, in Kenya while comparing them with Iceland, a developed economy with equivalent geothermal energy potential. A questionnaire survey was conducted in public energy organizations in Kenya and Iceland. Statistical analysis was used to validate and evaluate the collected data. The study findings revealed that innovation collaboration systems in organizations positively predicted the employees’ innovation awareness, confirming that energy sector innovations shall require public–private sector collaboration in developing innovative, incremental, and disruptive energy solutions. Employee knowledge and skills, on the other hand, were found not to be a predictor of an organization’s innovation awareness. Furthermore, employees’ motivation to innovate, as well as organizational innovation strategy, management structure and leadership, were found to positively predict an organization’s readiness to innovate. Finally, the Kenyan energy sector was benchmarked against the Icelandic energy sector indicating some noteworthy differences in the prioritization of energy sector climate action initiatives, with most organizations identifying themselves as innovation generators and innovation adopters and the least being innovation imitators, showing the organizations’ commitment to developing new technologies, markets and policies towards sustainable energy solutions.
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