The typologies of power: Energy utility business models in an increasingly renewable sector
- Publication Type:
- Journal Article
- Journal of Cleaner Production, 2018, 195 pp. 1032 - 1046
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© 2018 Elsevier Ltd In the last decade energy utilities have been confronted with the challenge of maintaining business-as-usual energy production in a world seeking to dramatically increase levels of variable renewable energy (VRE) in the energy sector. To understand the state of business models in this changing sector, 50 Australasian and European energy utilities were analysed. Findings identified 4 emerging energy utility and utility equivalent business model typologies, in addition to the existing Traditional Energy Utility typology: the Green Energy Utility, the Cooperative Energy Utility, the Prosumer Energy Utility, and the Prosumer Facilitator. The study revealed that whilst energy utilities and energy equivalent utilities are aware of the need for innovation and new value propositions to deal with the changing energy market landscape, there is a gap regarding how they will financially adapt to the impact of increased VRE. All typologies were found to be financially vulnerable to increasing levels of VRE capacity present in the energy sector. More specifically, the business models and support business strategies rarely considered the potential future impact that VRE would have on their viability. This paper highlights proposed future routes of business model adaptation for the five typologies, and provides insights for VRE uptake in practice and policy.
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