While a consensus appears to have evolved among many sustainability researchers and practitioners that sustainable development at the societal level is not very likely without the sustainable development of organizations, the business model as a key initiating component of corporate sustainability has only recently moved into the focus of sustainability management research. Apparently, the usual approaches to sustainable development of philanthropy, corporate social responsibility, and technological process and product innovation are insufficient to create the necessary radical transformation of organizations, industries, and societies toward genuine, substantive sustainable development. More in-depth research is needed on whether both modified and completely new business models can help develop integrative and competitive solutions by either radically reducing negative and/or creating positive external effects for the natural environment and society (cf. Boons & Lüdeke-Freund, 2013; Hansen, Große-Dunker, & Reichwald, 2009; Schaltegger, Lüdeke-Freund, & Hansen, 2012; Stubbs & Cocklin, 2008). One of the first articles in this field was published in Organization & Environment. The Stubbs and Cocklin (2008) article titled “Conceptualizing a ‘Sustainability Business Model” was a seminal study published a few years before the currently emerging wave of academic business model publications. The Stubbs and Cocklin study revealed a set of normative principles of organizational development that together form an “ideal type” of sustainability-oriented business model. These authors pioneered the field of case-based theory building for sustainability-oriented business models, using Interface Inc. and Bendigo Bank as examples of sustainability-driven organizations. Their ideal type comprised different structural and cultural attributes of an organization, such as developing community spirit, investing in employees’ trust and loyalty, and engaging in sustainability assessment and reporting. They also advanced propositions about sustainabilityoriented business models dealing with an organization’s purpose and goals, its performance measurement approach, the need to consider all stakeholders, how nature should be treated, whether the organization’s leaders drive the necessary cultural and structural changes to implement sustainability, and whether a systems-level, as well as a firm-level, perspective should be employed.

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Business Models for Sustainability: Origins, Present Research, and Future Avenues

Business models are developed and managed to create value. While most business model frameworks envision value creation as a uni-directional flow between the focal business and its customers, this article presents a broader view based on a stringent application of stakeholder theory. It provides a stakeholder value creation framework derived from key characteristics of stakeholder theory. This article highlights mutual stakeholder relationships in which stakeholders are both recipients and (co-) creators of value in joint value creation processes. Key findings include that the concept and analysis of value creation through business models need to be expanded with regard to (i) different types of value created with and for different stakeholders and (ii) the resulting value portfolio, i.e., the different kinds of value exchanged between the company and its stakeholders. This paper details the application of the stakeholder value creation framework and its theoretical propositions for the case of business models for sustainability. The framework aims to support theoretical and empirical analyses of value creation as well as the management and transformation of business models in line with corporate sustainability ambitions and stakeholder expectations. Overall, this paper proposes a shift in perspective from business models as devices of sheer value creation to business models as devices that organize and facilitate stakeholder relationships and corresponding value exchanges.

A Stakeholder Theory Perspective on Business Models: Value Creation for Sustainability

The sustainable business model pattern taxonomy—45 patterns to support sustainability-oriented business model innovation

The potential of sharing economy business models for sustainable value creation

Towards the ex-ante sustainability screening of circular economy initiatives in manufacturing companies: Consolidation of leading sustainability-related performance indicators

Whether and how “sustainable business models” effectively support sustainable development is not just a matter of design but also of the measurability and manageability of business model effects. While the interrelations between organisations’ sustainability performance and their business models is discussed in an increasing number of academic and practice publications, appropriate management approaches for the deliberate assessment and management of business models and their expected contributions to a sustainable development of the natural environment and human society are currently not available. Therefore, this chapter discusses this research gap and proposes a conceptual framework for sustainability oriented business model assessments.

Sustainability-Oriented Business Model Assessment—A Conceptual Foundation

Decentralized energy production offers an increased share of renewable energy and autonomy compared to the conventional, grid-only solution. However, under the net-metering scheme, the energy losses in batteries translate into financial losses to an investor seeking to move away from grid-only electricity and set up a residential PV+Battery microgrid. Our paper examines a hypothetical support scheme for such a project, designed to balance the economic disadvantage through partially supporting the acquisition of batteries, and thus ensure that the microgrid solution is more attractive than no investment. For this we develop four case studies based on experiments carried out in Greece, Italy, Denmark and Finland. Using the minimization of the Net Present Cost for each project, we compare the PV+Battery solution to the grid-only scenario over 25 years, for a range of electricity prices. The results illustrate first how the success of this project depends on the price of electricity. Second, we find that under current conditions in the respective countries the need for battery support varies between zero in Denmark and 86% in Italy, which reflects how the disadvantages of net metering can only be counterbalanced by either very high electricity price or very high solar resource. Our paper contributes thus to the discussion about the favourable environment for batteries in residential microgrids.

https://www.mdpi.com/1996-1073/12/1/165/pdf

Economic Performance of Using Batteries in European Residential Microgrids under the Net-Metering Scheme

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A Cross-European Analysis of the Impact of Electricity Pricing on Battery Uptake in Residential Microgrids with Photovoltaic Units

Climate neutrality is one of the greatest challenges of our century, and a decarbonised energy system is a key step towards this goal. To this end, the electricity system is expected to become more interconnected, digitalised, and flexible by engaging consumers both through microgeneration and through demand side flexibility. A successful use of these flexibility tools depends widely on the evaluation of their effects, hence the definition of methods to assess and evaluate them is essential for their implementation. In order to enable a reliable assessment of the benefits from participating in demand response, it is necessary to define a reference value (“baseline”) to allow for a fair comparison. Different methodologies have been investigated, developed, and adopted for estimating the customer baseline load. The article presents a structured overview of methods for the estimating the customer baseline load, based on a review of academic literature, existing standardisation efforts, and lessons from use cases. In particular, the article describes and focuses on the different baseline methods applied in some European H2020 projects, showing the results achieved in terms of measurement accuracy and costs in real test cases. The most suitable methodology choice among the several available depends on many factors. Some of them can be the function of the Demand Response (DR) service in the system, the broader regulatory framework for DR participation in wholesale markets, or the DR providers characteristics, and this list is not exclusive. The evaluation shows that the baseline methodology choice presents a trade-off among complexity, accuracy, and cost.

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Iolanda Saviuc

Papers

Sustainability-Oriented Business Model Assessment—A Conceptual Foundation

Economic Performance of Using Batteries in European Residential Microgrids under the Net-Metering Scheme

A Cross-European Analysis of the Impact of Electricity Pricing on Battery Uptake in Residential Microgrids with Photovoltaic Units

Demand Response Impact Evaluation: A Review of Methods for Estimating the Customer Baseline Load

Business Model Assessment: Taking a Stakeholder Perspective