Circular Business Model Experimentation in the Solar Industry

Abstract

The imperative for a systematic transition from the unsustainable linear economic model to a circular economy is increasingly pressing. While the photovoltaic (PV) industry is playing a pivotal role in expediting the energy transition through its predominantly linear organization, it simultaneously confronts the emergence of new challenges, notably the proliferation of substantial waste volumes. Consequently, there arises a critical necessity for the development of novel, more sustainable business models (BM) in the context of circular economy. However, effecting the transformation of these business models and their associated ecosystems is a multifaceted endeavour. While experimentation with business models can serve as a catalyst for this process, circular business models (CBMs) often encounter formidable obstacles on their path to market adoption, particularly when necessitating cross-organizational collaboration within ecosystems. This paper adopts a case study methodology with an action research approach. Collaborating with eight organizations from the Swiss PV industry in the "Swiss PV Circle" project, the authors aim to experiment with CBMs in pilot projects focused on the reuse of PV modules. Initial findings illuminate the technological feasibility, encompassing requisite skills and partner networks, as well as the considerable circularity potential for prolonging the product lifecycle and niche desirability for specific customer segments. However, the viability aspect presents a challenge, as prevailing market prices for new PV modules currently render entry into reuse BMs less promising. Subsequent pilot projects seek to explore non-financial value proposition aspects to enhance viability. This paper contributes empirically to the literature on circular strategies within the PV industry and theoretically advances the discourse on CBM experimentation.