12.2 Business Models for Sustainability—Innovative Regional Business Models as Subject and Trigger of a Sustainable Change in the Energy Industry

Florian Luedeke-Freund , Centre for Sustainability Management, Leuphana University Lueneburg, Lueneburg, Germany
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  • Are the characteristics of “conventional” business models in the energy industry linked to defined problems which occur when performing business? And to ask for the opposite correlation, are “alternative” models able to promote positive effects—positive in terms of an ecologically and socially sustainable energy industry? If the current conventional structures tend to harm man and the environment, what is the role of the underlying business models, i.e. the business logic of earning money, when asked for a possible shift towards sustainability in energy production and supply?

    To a certain degree it has to be recognized that the dominating oligopoly of a few multinational energy companies is based on and highly addicted to using fossil fuels. They operate in centralised structures which are obviously opposed by alternative approaches of decentralised energy systems based on regionally available renewable resources like biomass, wind and solar energy. According to some authors this situation should rather be understood as the convergence than the polarity of different production and supply systems. Independent from questions of convergence or opposition it is obvious that different ways of production and supply are based on different business models and logics. Is the corporate sustainability performance related or even dependent on the different business models’ characteristics?

    The approach at issue seeks to find out how innovative enterprises and their business logics may contribute to solve central sustainability problems. This research—in a first step branch specific—shall answer the general question of how essential sustainability problems could be addressed by new and uncommon ways of production and supply. The objects of investigation are observable and hypothetical business models following general business model frameworks. So far, existing business model research related to issues of corporate sustainability often deals with cases of car-sharing, i.e. a more service oriented perspective.

    The expected insights from this specific perspective have to be generalized as research on the business model / corporate sustainability correlation is currently not too far. To analyse this correlation the approach has to focus on a suitable unit of analysis, which allows considering implications of the embedding socio-technical system but is also detailed enough for gathering information on organisations’ structures and management approaches. It is assumed that on the business model level organisational and managerial aspects, their expression via business performance and the connectedness to general and specific environments could be sufficiently analysed. This means, issues of performing business and its effects will be examined crossing companies’ borders following defined aspects like infrastructure management, product innovation, customer relations and financial aspects. In other words: the resource-based and the market-based view of the firm have to be combined for an integrated point of view. If the applied business model definitions make it necessary to look at the whole supply chain—maybe from resource extraction to the customer’s energy use—the analysis has to take care in order to understand the characteristics and the relevance of the business models and their factors of success (or failure).

    It follows that in this context the term business model has a twofold meaning: Firstly, it is a theoretical perspective of analysis. Secondly, when it comes to distinct considerations of the relations between bioenergy businesses and questions of corporate sustainability, it will be an empirical result of examining specific case studies. Three steps have to be taken to apply the described perspective and to develop an appropriate understanding of business models and their contributions to corporate sustainability:

    1.       Find out which theoretical elements of business models are considered to be most important, which business model frameworks are most developed.

    2.       Test if the resulting definition and framework are applicable to innovative concepts like bioenergy villages, closed regional supply chains and others to be identified.

    3.       Examine if the business model perspective helps to address general questions of corporate sustainability, i.e. if a “business model for sustainability” results.

    The current work aims at connecting business model frameworks and questions of corporate sustainability and its application to first case studies (steps one and two). The latter refers to examples like the bioenergy villages Jühnde (Germany) or Mureck (Austria).