The Business Model Innovation Tool from the E-LAND Toolbox: How can the energy systems be innovated and the related business aspects

Smart Innovation Norway together with the University of St. Gallen have developed a series of workshops that began in June 2021 and focused on the implementation of the Business Model Innovation tool on the pilot sites.

The Business Model Innovation tool is one of the tools of the E-LAND toolbox and is a first-of-its-kind tool designed specifically for the needs of energy communities in multi-vector settings. The tool provides a set of building blocks, known as ‘business model patterns,’ that have been proved successful. The tool’s framework will show future energy communities how to adapt business model patterns to the local context and combine them to create promising business models.

The framework for Business Model Innovation is based on lessons learned from a variety of existing businesses and projects. A total of 67 success stories were reviewed to determine the most significant features for the energy community and their energy-related business. One of the key aspects that the developers used as a starting point for the overall development of the tool was to emphasize unique aspects of energy communities, which was that energy communities are concerned not only with profit but also with contributing positively to the environment and society.

The four “I’s” processes

A four-stage process was developed to apply the tool inspired by a common business model innovation process that goes through four “I” stages: initiation, ideation, integration, implementation. The process developed to follow these steps has also been tailored towards the specific E-LAND tools and pilot partners. Starting in June 2021, the Norwegian Port of Borg, the Spanish Walqa Technology Park, and one of the Indian pilots in Auroville went through these processes, which concluded with defining a selection of business models for the pilot projects. The whole innovation process with one pilot lasted approximately one month. The Romanian pilot at the Valahia University of Târgovişte has recently begun the process.

Each of the pilots was taken through an introductory meeting, an initiation to understand their ambition for a business model innovation and energy targets. This was followed by an ideation workshop to collect new ideas that follow the pattern approach and the patterns were tailored to the specific context of the pilot sites. An analysis meeting followed to narrow down some of the most promising patterns and configure different business models using the promising patterns. After this, a 2^nd workshop was organized to perform a SWOT analysis on various configured business models and finalize 1-2 business models for detailed assessment going forward in the project. Based upon the piloting experience the finalized business models will be adapted accordingly and a final workshop shall be organized at the end of the project to wrap up the innovation process.

“For me as Project Manager of the Spanish pilot, the process is highly innovative and very useful. It is very difficult to translate abstract concepts such as the business model to concrete actions that translate into real and materializable opportunities. Following the proposed process, we have been able to identify the interested parties, work on the most important ideas for the property and translate it into two business models that serve as a working basis for establishing strategic planning in terms of energy and society,” says Pilar Gascón Zaragoza, R&D Project Manager at Inycom.

Thanks to the E-LAND business innovation process there are two promising BM for Walqa technology park (Spanish pilot):

• One short term BM considering solar PV PPA, EV chargers and energy efficiency measures.
• One long term BM adding hydrogen plus the living lab “running innovation projects to improve the sustainability of the tech park”

“We will reach the sustainable concept of getting large scale prosumers and becoming local energy produces with the active involvement of stakeholders and citizens in the whole process as a way to succeed,” adds Pilar.

Implementation of the BMI can also happen in online environments

“In a classical sense business innovation workshops are relatively frequently applied but most often in a physical in-person setting,” says Prof. Dr Merla Kubli, one of the developers of the tool. Since the process took place during an ongoing pandemic, the tool developers were forced to innovate the process compared to mainstream applications. Even though an online workshop has advantages and disadvantages it was still possible to create innovations despite being physically remote and not being able to have in-person workshops.

Key learnings in the innovation process

The workshops produced highly varied business model configurations for each of the pilots, as energy communities require tailored business models for each community, therefore there is no one-size-fits-all solution.

“It was quite obvious from the workshop experience that the business model for energy communities are distinctly different from profit-making businesses and they require a different process in order to innovate,” says Sanket Puranik, Senior Researcher at Smart Innovation Norway, and of the developers of the BMI tool.

The workshops helped the tool developers in their learning journey as well as the pilot partners in building business models adapted to their specific context. This came as a good opportunity to enhance the process based on the lessons learned from the first workshop, and then apply the improvements to the next pilot site workshop.

If you want to read more about the Business Model Innovation Tool click HERE.