A business model taxonomy for smart demand response in the residential sector

This study develops a taxonomy of business models for smart demand response (DR) in the residential sector, focussing on a Nordic country: Finland. The research addresses the growing need for innovative DR solutions to enhance energy system flexibility as renewable energy sources become more prevalent. Through 18 qualitative interviews with Finnish DR companies, the study identifies and categorises business models into four distinct types: smart building services, energy company demand response, solar power demand response, and the Airbnb equivalent for electric appliances. Each model reflects different strategies for integrating DR technologies and services with existing market structures. The taxonomy provides a systematic framework for understanding and comparing these business models, highlighting their potential for market upscaling and contributing to the sustainable development of smart energy solutions in the residential sector. • Taxonomy developed for residential smart demand response business models. • Four distinct demand response business model types identified. • Study examines Finnish demand response companies via 18 interviews. • Business models show diverse strategies to servitize DR technologies. • Framework aids in comparing and upscaling smart demand response solutions.