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Table 1 Comparison of business model characteristics (own representation, based on Richter, 2011, who analyses the German electricity market; data is derived from 20 interviews with representatives form 18 German utilities)

From: The renewable energy debate: how Austrian electric utilities are changing their business models

  Utility-side business model for renewable energies Customer-side business model for renewable energies
Product, value proposition Electricity remains commodity–the value proposition basically remains the same Shift from commodity delivery to energy service provider
Additional value for the customer through more environmentally friendly production New value propositions need to be developed
Customer interface Relationship with customers remains largely unchanged Better customer relationship is required to develop new value propositions
Customer segmentation allows customer base to be increased and an ‘eco’ price premium may be earned Customer segments change
New channels are needed
Channels mainly remain the same
Chance to improve corporate image and rebuild trust
Infrastructure management Small number of large-scale assets Large number of small-scale assets
Experienced in large-scale infrastructure projects No experience with development and operation of small-scale projects
Partnerships with project developers and suppliers Partnerships with system suppliers and local installation companies
Financial aspects Revenues through feed-in of electricity Revenues from feed-in and/or from services, source, and level of revenues unclear
Revenue models are available
New revenue models need to be developed
Cost structures reflect utilities’ experiences with large-scale infrastructure financing
Cost structure becomes more complex due to need for many small investments instead of a few large investments
Economies of scale from large-scale projects and project portfolios
High transaction costs reduce profits