Switching perspectvives

Creating new business models for a
changing world of energy

Switching perspectives: New business models for energy

The business models that brought the electric utility industry success in the middle of the 20th century are overdue for revisiting. Much of the basis for their foundation – one-way flow of power and information, declining costs associated with increased usage, undifferentiated and passive consumers, unlimited access to inexpensive carbon fuels for generation and regulatory protection from threats to the core businesses – has already shifted or will do so in the next decade.

To succeed in today's environment, fresh business models are needed, as well as changes in business architecture, protocols, rights and pricing terms to facilitate emerging products and services enabled by new technologies.

Any reassessment of business model, however, must accommodate key transformations in several areas:

These dramatic shifts all involve technological changes – changes that most energy providers understand. However, these shifts also require leaps into business model transformation that are new to most. Important decisions on how best to make these moves – and the resulting rise to prominence of companies that successfully do so – will occur over the next decade.

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Meet the author

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    John Juliano

    Global Energy and Utilities Lead IBM Institute for Business Value IBM Global Business Services

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