Business Models at the FfE: Science with Practical Relevance

Relevance of business models in technical research

In many of the subject areas in which the FfE is scientifically active, individual or combinations of various key technologies are the focus of investigations. Research in the technical feasibility and economically optimal integration of such technologies into the energy system is usually the cornerstone of scientific analyses. This profoundly technical approach enables an objective assessment of innovative technologies’ optimal application and technical implementation.

However, innovations often fail not because of their technical feasibility but because of their practical feasibility. Influencing factors such as market conditions, customer needs, regulatory framework conditions, or production scalability determine the success or failure of a business idea to a greater extent. Even if a technology is highly efficient and systemically optimal, it does not necessarily make sense from a business perspective.

For realistic, practice-oriented research, it is essential to include business aspects in the investigations of innovative key technologies in addition to the purely technical-systemic view. For this reason, the scientific examination of the topic of business models at the FfE is considered an integral part of the research work. Based on a deep technical understanding of the underlying technology, business models can be precisely developed, analyzed, and/or evaluated.

Components for a methodical business model analysis

The expertise of the FfE can be divided into the four areas of use case preparation, business model development, profitability analysis, and business model evaluation. Depending on the requirements and research focus, either the entire process can be run through, or a single area of expertise can be considered individually. As illustrated in the figure below, different tools are available as methodological aids for each area.

Starting from the basic innovation, potentially relevant use cases can be defined by the FfE Use Case Methodology. Resulting from the methodology are clearly defined use cases, which various models represent. The models tried and tested in this field (Value Proposition Model, Business Model Template, Business Model Canvas) are used for the concrete development of business models. The tools can be combined in different ways depending on the technology, use case, and goal of the business model development. Based on the diverse model landscape of FfE, it is possible to back prepared business models with economic values. In order to define a profitability range in which the business model will realistically be located, revenue and cost estimates can be made based on simulation results. Finally, the portfolio also includes the valuation of business models. The FfE Evaluation Guide, which comprises the most relevant evaluation criteria in the energy industry context, can be individually tailored to the relevant economic and social sectors.

Figure: Possible analysis in the area of business models at the FfE

Continuous development through utilization in projects

The topics in which business models are considered at the FfE are diverse and include innovative solutions for flexibilization and sector coupling, digital platform solutions, and classic energy transition technologies. In the following FfE projects, business models are considered as an integral research component:

By embedding business models in research and implementation projects, not only the business models to be analyzed but also the used methodologies and tools are constantly put to the test and developed further. In particular, the involvement of partners from industry and business in the projects of the FfE has the great benefit of evaluating the developed content in terms of its applicability and thus spanning the arc from science to practice.

Further Information: