Energy will be, no doubt, one of the dominating issues of the decade and beyond. That’s why I was really excited to discover how Jigar Shah, a 34 year old entrepreneur, disrupted the field of solar energy – he achieved that not through technology innovation, as one might expect, but based on an innovative business model.
Last week, my sister Nathalie, a senior environmental lawyer at the International Institute for Sustainable Development (IISD), pointed me to an article in the OnEarth magazine about an organization that has changed the face of the solar energy sector. She had just come from a dinner meeting with Jigar Shah, the founder of SunEdison, which has developed into the largest provider of solar power in the United States.
I sketched out SunEdison’s business model, which will definitely figure in our new project BusinessModelsBeyondProfit.com. Check out the slides:
The closing paragraph in the OnEarth article was particularly interesting. He stresses that the driver is NOT technology – it’s the business model. Jigar Shah says:
“The big area for me has always been to come up with business solutions to address global warming,” Shah says. “The thing that people have had a hard time understanding about solar is that it’s part of the energy business. While new energy technologies come up all the time, technology is not the driver of the energy industry. The driver is the business model: how you get it financed and how you apply traditional risk-management methods to solar and wind and biomass. That to me is the key to solving global warming.”
If you are interested in the state of the solar energy industry (in the US) you should watch Jigar Shah in the keynote below. It’s the first part of a total of 6 videos, which you can find on youtube:
Nice presentation and interesting business model Alex! You have also found a great way to tell a story with your slides using your avatar. Keep up the good work!
//Anders
Thanks, Anders. Took me a whole day to make the presentation… I needed to develop some B2B examples for a client and this one fits nicely with my other projects.
[...] This business model is very interesting and is a good way to convince investors: http://www.businessmodelalchemist.com/2010/03/a-business-model-for-solar-energy.html [...]
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Great post and presentation. It seems that the “green revolution” is pushing more than just technological innovation, it’s forcing us to rethink some very old business models. Along with Property Assessed Clean Energy financing (PACE), PPAs and other funding mechanisms are becoming the de facto standard for how we can scale renewable energy systems.
[...] Model Alchemist for more info and material on business model canvas. Check this case study on SunEdison, great example for the power of innovative business models. Enjoy! 22 Aug This entry was written [...]
[...] This business model is very interesting and is a good way to convince investors: http://www.businessmodelalchemist.com/2010/03/a-business-model-for-solar-energy.html [...]