Energy Business Models Research Articles

Energy Supplier 2.0: A conceptual business model for energy suppliers aggregating flexible distributed assets and policy issues raised

The ongoing digitalization of the energy sector opens up opportunities for novel business models which can help to overcome some of the challenges accompanying the sustainable energy transition. One necessity in a more decentralized energy system with high shares of intermittent renewables is the provision of flexibility. This paper empirically applies the business model generation approach of Osterwalder and Pigneur (2010) in order to enhance our understanding of these transition challenges. The insights gained indicate that the focus of business models in the electricity supply market has to switch to a customer-driven perspective. To this end, the conceptual business model of an “Energy Supplier 2.0” as a dedicated aggregator of flexible capacities on the household level is investigated, showing how a specific new energy business model can tap the potential of distributed flexible energy assets. We find that the aggregation of the inherent economic potentials of these flexibilities is suitable to provide additional revenue streams, support grid operators, and promote customers to become “prosumers”. Despite these promising advantages, we find in the case of Germany that the current regulation and policies need to be adapted to achieve a broader diffusion of this type of business model and offer suggestions on the implementation.

Prosumers in the post subsidy era: an exploration of new prosumer business models in the UK

This paper explores the evolving renewable energy ‘prosumer’ phenomenon in the United Kingdom (UK). It identifies and evaluates how prosumer business models can exist beyond direct subsidy and the range of prosumer business model archetypes currently in operation. Through a series of in-depth interviews and document analysis, the paper identifies the key opportunities and challenges for these innovative energy business models. The analysis shows that recent developments in technology such as the diffusion of smart meters, li-ion batteries, peer-to-peer trading platforms and electric vehicles are opening up a range of new value propositions, which in turn are beginning to be exploited by a range of new business models. In many cases the regulatory, financing and institutional governance landscape of the UK lags behind, however, inhibiting these emerging business models. Moreover, these business models rely on managing a complex set of values for consumers that reach deeper into their lives than traditional tariffs. Thus, successful business models must manage this complexity if they are to be adopted by the disengaged majority. Energy policy and energy practitioners can leverage these emerging trends in service of a low carbon energy transition by adopting ‘ten principles’ of prosumerism; and six UK policy recommendations.

An energy leap? Business model innovation and intermediation in the ‘Energiesprong’ retrofit initiative

Business model innovation is increasingly necessary for the transition to a sustainable energy system. In this paper we outline how whole-house energy ‘retrofits’ are likely to require business model innovation to gain widespread adoption. Through semi-structured interviews and document analysis, we undertake a case study of the ‘Energiesprong’ retrofit business model and contrast this with the existing ‘atomised’ market model. We highlight the central role of an innovation intermediary - the Energiesprong ‘market development team’- in this business model innovation and further how Dutch policymakers sought to promote it through the creation of this intermediary. In doing so we develop a novel framework, combining the components of business models with the functions of intermediaries. We suggest that for radical energy business model innovations to be adopted, intermediaries may need to facilitate, configure and broker system innovation in multiple system elements. Finally, the paper suggests this case and framework could provide lessons for how intermediaries and in turn policymakers might foster energy business model innovation in other sectors.

The fifth archetype of electricity market: the blockchain marketplace

Enabling and empowering the diverse energy resources to have active yet efficient participation in the smart grid and energy market is an unrivaled challenge for the energy industry. This research expands the four dominant archetypes of business models in the energy and electricity market, creating a fifth archetype, the “blockchain marketplace”. The contributions of the study are to identify the extant electricity market designs and architectures as centralized and pseudo-decentralized while proposing a fully decentralized architecture enabled by the blockchain. The research contributes to the literature of smart grids and demand-side management and introduces the value configuration/architecture approach for the energy market and business model domains.

Study On Partnership Between Energy Companies & Blockchain Start-Ups: Based On Corporate Investment Model

The Aim Of This Study Is To Categorize The Partnership Types Between Legacy Energy Companies And Blockchain Energy Start-Ups In 2017 By Investigating Partnership Deals. For It, The Author Reviews Previous References Dealing With Blockchain Energy Business Models And Discusses The Corporate Investment Model. As Results, Among Twenty Start-Ups, Five Partnership Deals Have Been Found. The Enabling And Passive Partnership Is Related To Fundamental Technology Of Blockchain Application And The Cases Are ‘Electrical Vehicle Charging’ (Slock.It And Rwe) And ‘Customer Switching’ (Electron And Tepco). The Driving Partnership Is Related To Viable For Sustaining Business And The Cases Are ‘Microgrid’ (Sun Exchange And Powerhive) And ‘Ipp Settlement’ (Btl And Wien Energie). The Emergent Partnership Is Related To Robust & Scalable For Business And The Cases Are ‘Local Energy Market & P2P Energy Network’ (Lo3 Energy And Siemens, Power Ledger And Vector, Innogy Innovation Hub And Tepco), ‘Decentralized Exchange’ (Grid Singularity And Rocky Mountain Institute), And ‘Retail Trading & Settlement’ (Ponton And Energy Companies).

Exploring landowners’ post-construction changes in perceptions of wind energy in Michigan

Researchers have suggested that residents’ acceptance of wind turbines follow a U-shaped curve over time, starting with generally positive attitudes about wind energy, dipping once a project is proposed, and then rebounding after construction. This research considers how residents’ perceptions of the benefits and negative impacts of wind turbines shift post-construction by surveying the same individuals (n = 520) at two time periods after a nearby wind project became operational. We find that residents’ perceptions follow two separate trajectories based on their perception of the fairness of the wind siting planning process and—to a lesser extent—whether they have a direct financial stake in the wind project. Residents who perceived a fair planning process tended to perceive greater benefits of wind turbines, job creation, and revenues for landowners specifically, while residents who perceived an unfair process perceived significantly greater negative impacts, including visual and noise problems, reduction of nearby property values, and human health problems. These results suggest that while energy business models that extent direct financial compensation to more landowners impact the attitudes of residents in the short-term, resident attitudes about procedural justice may have implications that extend well beyond the project planning stage, impacting long-term support for adding new and repowering old turbines.

Power Generation System for Using Unused Energy in District Heating Pipelines

When the hot water for district heating (DH) is supplied through a thermal grid, a pressure differential control valve (PDCV) in a substation protects the users’ equipment from the high pressure water and helps to supply DH water to long distance. It also controls the constant temperature and adjusts the constant pressure in the thermal grid. However, cavitation occurs in PDCV due to the use of high pressure DH water. It causes frequent failures, many problems and energy losses. It makes a complaint to both the operator and the user. In order to solve these problems, we have introduced the hydroelectric power generation method to replace PDCV with hydraulic turbine, convert the unused differential pressure within a DH pipe into electricity. When a differential pressure power generation system is operated in the user’s substation, power generation of about 10 to 20 MWh and reduction of carbon dioxide emission to about 7 tons can be seen for a year. It is possible to install more than 3,000 out of about 10,000 of the district heating in Korea. It can grow into a new energy business model. It is also calculated that the DH plant has a power saving effect. The cost of the DH pump power can reduce by more than 3%, and the efficiency of CHP plant can increase by more than 0.3% because 10% defective of PDCV is decreased.

Legal Framework of Decentralized Energy Business Models in Germany: Challenges and Opportunities for Municipal Utilities

Feasible and profitable business models to better integrate and harness decentrally generated renewable energy are expected to constitute a key element for the energy transition in Germany. Until now, generated electricity of decentralized systems is to the largest extent only used by the property owner directly or fed into the public grid. To make better use of the generated electricity, it is necessary to find business models that provide an opportunity for different market actors, such as municipal utilities and residential prosumers. Due to the importance, yet low-anticipated monetary potential of such solutions, the legislator encourages their implementation by exemption of statutory fees, levies and taxes as well as by offering public remunerations, premiums and compensations in some cases. Capitalizing on these benefits, however, is only feasible under compliance with the legal requirements. In the light of the considerations above, this work states and analyzes the legal and regulatory framework of different business models within the German energy landscape. The major aim is to identify opportunities and challenges for the implementation of the business models self consumption, direct consumption, direct marketing, demand response, community electricity storage and net metering at the municipal level. The findings show that the profitability of various decentralized on-site business models depends primarily on the current statutory cost exemptions and compensations. At the same time, the regulation is characterized by unsystematic specific exemptions which leads to uncertainty regarding long-term planning. Additionally, although not directly privileged by the existing legal framework, municipal utilities are better suited to handle the legal burdens due to their experience and their administrative infrastructure.

Policy Note: "Addressing Trade-offs to Promote Safely Managed Wastewater in Developing Countries"

Policy Note: "Addressing Trade-offs to Promote Safely Managed Wastewater in Developing Countries"

Alternative business models and entrepreneurship

Electrification of the car is an inevitable trajectory; only battery electric vehicles (EVs) give the option – provided a zero carbon generating mix is developed – of ultimately zero carbon and zero emissions transport. Yet this means disruptive change to the existing automotive and energy business models covering all sections of the value chain, which provides entry points for new, entrepreneurial operators from outside the sector bringing with them new business models. We are entering a transition period, where some of these alternative business models are already seen to work and those of Autolib and Tesla are highlighted here. New electric vehicle (EV) business models need to extend beyond the boundaries of the business itself and should also include a consideration of context and environment, or ‘regime’ (Geels, 2002), particularly in the role of government. It should be emphasized that EV business models are dynamic, still emerging and are currently enjoying artificial market conditions due to widespread incentives. Private and public sector players are still exploring what their respective roles should be in future EV business models.

Designing viable multi-commodity energy business ecosystems: Corroborating the business model design framework for viability

Abstract In this paper, a multi-commodity energy business model for an industrial park is designed and evaluated using the extended “business model design framework for viability”. The framework has been validated earlier for mono-commodity energy systems. Our goal is to examine the application of the business model design framework for viability for multi-commodity energy systems as they are more complex. The framework was applied to an industrial park, where heat and electricity networks are integrated. The business model was designed iteratively to harvest and exploit the flexibility embedded in the industrial processes of the heat consumers. The first iteration showed that the business model design framework for viability was largely successful. However, adding two extensions to the framework helps to deal with the complexity of designing and evaluating viable business models for multi-commodity energy systems in a better way. First, the configuration techniques in the framework are extended to include reference business models. Second, the evaluation criteria in the framework are extended to include the capabilities of the stakeholders. The extended business model design framework for viability better enables the design of complex business models and allows to evaluate the capabilities of the stakeholders to implement the designed Business model. The extended business model design framework for viability successfully facilitated the design and evaluation of a viable multi-commodity energy business model and therefore is corroborated.

Enabling policy for solar PV: the gap in the urban global south

This paper critically reviews the state of solar photovoltaic (PV) energy in the urban global south, and highlights the lack of both deployment and policy research in this important segment. The importance and complexity of solar PV uptake and suitable solar PV policy in the urban global south are discussed through the lens of the selected case study: Delhi. This case study includes an analysis of relevant solar PV policy and demonstrates barriers facing existing business models, and the problem of knowledge transfer. The study ends with a look at the prospects for novel business models. Results of the case study analysis highlight the need for an enabling policy environment and innovative business models to increase accessibility and facilitate deployment of solar PV to residential customers. This paper contributes to the under-researched field of urban solar policy in the global south and offers insights into the theory and practice of solar energy business models.

Responding to policy change: New business models for renewable energy cooperatives – Barriers perceived by cooperatives’ members

Renewable Energy Cooperatives (RECs) in Germany have received considerable attention in recent years, their number having risen to nearly a thousand since 2004. This growth has resulted largely from Germany's feed-in tariff system. Recent changes in this policy, however, have made the previous REC business models mostly unprofitable, so RECs are looking for new business models. Our study aims at identifying those new models and characterizing the implementation barriers RECs face. To this end, we interviewed REC members and management and observed REC annual general meetings. We found three significant barriers: first, risk aversion on the part of both members and management; second, concerns about the environmental impacts or the ethics of certain models that, while legal, are not felt to align with the intentions of lawmakers; finally, the lack of competencies and time of the mostly unsalaried REC management. These barriers could put the future of RECs at risk, and so threaten the contributions RECs make to the German Energy Transition. Professionalization, partnerships and other strategies can help mitigate this risk. If RECs are to continue to play an important role in the energy transition, policy makers would be wise to consider measures to support their continued growth.

Development status and prospects of the Energy Internet}{Development status and prospects of the Energy Internet

The Energy Internet is a new energy ecosystem based on electricity with high penetration of renewable energy, high synergy of multiple energy types, high synergy of energy value chains from supply to demand and from planning to operation, and high participation of stakeholders. In this paper, we discuss the background and significance, basic connotation, dynamic development, current domestic and foreign status, scientific issues, and future development of the Energy Internet. The Energy Internet is based on the fusion of Internet Thinking, advanced information technology, energy industry, synergistic energy network, cyber-physical energy system, and innovative energy business models. It supports the energy revolution in achieving green, coordinated, and efficient development and drives the economic growth.

Teaching elephants to dance: Collaborating to create a sustainable future

Today's traditional energy business models will die in tomorrow's world – collaboration between big business and inventive entrepreneurs is instead the key to a successful energy transition, writes Elena Bou.

Competition at the Grid Edge: Innovation and Antitrust Law in the Electricity Sector

The advent of distributed energy technologies, most notably, distributed solar energy, poses a competitive threat to the electric utility industry. Here I provide a comprehensive assessment of the U.S. electric utility industry's regulatory response to this threat over the past three years. Electric utilities across the United States are asking their Public Utility Commissions for changes in rate structures that, depending on their details, may either reduce cross-subsidies to distributed energy resources or may be erecting much higher barriers to entry for innovative energy technologies and business models. Usually, a utility's actions are exempt from antitrust scrutiny under the State Action Immunity and Filed Rate doctrines. I argue that in the case of the utility response to distributed energy, this may not be the case. Because the risk exists, both electric utilities and their overseeing commissions need to make much greater efforts to evaluate the competitive impacts of changes in rates - a consideration that is largely absent from the proceedings to date. By doing so, they will both ensure that society’s interest in a cleaner, more innovative, more productive energy sector is protected and at the same time minimize their own risks of liability under the antitrust statutes.

Sustainable business models for wind and solar energy in Romania

Abstract Renewable energy has become a crucial element for the business environment as the need for new energy resources and the degree of climate change are increasing. As developed economies strive towards greater progress, sustainable business models are of the essence in order to maintain a balance between the triple bottom line: people, planet and profit. In recent years, European Union countries have installed important capacities of renewable energy, especially wind and solar energy to achieve this purpose. The objective of this article is to make a comparative study between the current sustainable business models implemented in companies that are active in the wind and solar energy sector in Romania. Both sectors underwent tremendous changes in the last two years due to changing support schemes which have had a significant influence on the mechanism of the renewable energy market, as well as on its development. Using the classical Delphi method, based on questionnaires and interviews with experts in the fields of wind and solar energy, this paper offers an overview of the sustainable business models of wind and solar energy companies, both sectors opting for the alternative of selling electricity to trading companies as a main source of revenue until 2013 and as the main future trend until 2020. Furthermore, the participating wind energy companies noted a pessimistic outlook of future investments due to legal instability that made them to reduce their projects in comparison to PV investments, which are expected to continue. The subject of the article is of interest to scientific literature because sustainable business models in wind and photovoltaic energy have been scarcely researched in previous articles and are essential in understanding the activity of the companies in these two fields of renewable energy.

Techno-Financial Analysis of Energy Access through Hybrid System with Solar PV under the Various Rural Community Models for State of Uttarakhand, India

Uttarakhand state comes under special category state where approximately 69.45% population lived in rural area under the population density with varied range of 37 to 607 persons per sq.km. Although Uttarakhand is having per capita consumption of 1112.29 kWh which is higher than national average per capita consumption of 779 kWh as till date, but remote communities, villages are not able to access clean, cheep and good quality of energy due to uneven terrain, lack of proper transmission & distribution lines [1]. 100% villages are electrified under the RGGVY scheme as per the Ministry of Power Government of India, but due to poor loading of transformer, lack of grid infrastructure and natural calamities, remote house owners are not able to get good quality of power thus affect the livelihood and source of income generation in various means [2]. As Uttarakhand state having future plans to be make state energy sufficient and energy access to all by year 2016-2017, so major ground level initiative have been taken by Government of Uttarakhand. The government of Uttarakhand has incorporated innovative business model to provide good quality of power with non-conventional energy source. Under the initiative invlovement of local people and village level, panchayats have ownership and responsibility to operate these clean energy business model to improve livelihood in remote hilly places of Uttarakhand. Under this analysis, five different type of community models are categorized as Community 1, Community 2, Community 3, Standalone 1 & Standalone 2 for rural &remote communities based on number of unclustered households with the distance covered between 200 m to 20 km, and electrical loads i.e. lighting, fan, mobile chargers, television along with time of day energy consumption patterns. These community models are for remote hilly location where grid integration and distribution lines are not feasible to built due to hilly terrain, low soil strength and huge expenses for expanding power cables for supplying good quality power. The preliminary studies and simulations has been done in HOMER tool by considering the various composite source of power, i.e. Solar PV with battery bank, Solar PV with battery Bank & Generator, and Solar PV along with DG. These three hybrid source of power generation with Solar PV as base source under five different community models, the techno-commercial feasibility has been analyzed in terms of load sharing proposition with Solar PV and battery, DG, Energy production through PV, load consumption per year, Excess and unmet energy monitoring, battery sizing to meet the load during nights, DG operation when the solar energy not available due to weather condition and non availability of sunshine in night. Financial feasibility has been examined in terms of levelized cost of energy, cost summary and O&M cost per year of three integrated sources of energy generation with Solar PV under each community model. Solar PV power plant , which is the best renewable source of energy to cater energy access issue in remote hilly places. The Uttarakhand receives good amout of daily average radiation level of 5.14 - 5.50 kWh/m2/day. Financial feasible community models for different hilly region based on their energy consumption need to be implemented with the help of local community by providing ownership to local people, panchayat, for it not only caters energy access issue but also provides clean, cheep, uninterruptable energy and improves livelihood standard to locals by engaging them into operation maintenance and tariff or rent collection. The study shows that Solar PV power plant with battery bank is the optimal solution considering life cycle cost of hybrid system. It is feasible due to low operation and maintenance cost, price declination of battery and Solar PV module, battery prices at time of replacement.

White paper on clean energy business models

White paper on clean energy business models

Carbon neutral strategy for and existing Mediterranean tourist development

The purpose of this article is to show the carbon reduction strategy for the integrated regeneration of Playa de Palma, Palma de Mallorca. The article will describe the strategy which has been established and the measures planned in order to reach the target of zero CO 2 emissions for 2050, and will provide a description of an energy model based 100% on renewable energies. The strategies include not only technological measures aimed at energy efficiency and the integration of renewable energies in buildings and the urban environment, but also other measures designed to change energy consumption patterns. In this latter respect, in addition to citizen awareness programmes, energy demand management models based on intelligent electrical networks will be implemented. The viable implementation of the strategies requires the establishment of energy business models and models for the corporate structures set up around the Palma Beach energy agency.