For example, a company has an idea for a new form of heat storage. The range of applications goes from warm water and heating for houses, to providing large scale heating and low heat for industrial purposes. Obviously, they cannot cater for all of these potential areas at once, so a decision is required, where to go first. First one needs to assess the respective heat demand in the various applications. Then for each application the storage duration and time of discharge will determine the size of the heat storage.The various heat generation options for the different use cases need to be mapped out. To round off the technical side of the influences one needs to assess the ease of integration into existing systems.

Next set of influences are financials. What does a single unit potentially cost? Here some assumptions of material and energy cost form the base and the level of improvement potential in production are the main drivers. Then there is the saving potential when using the heat storage to capture cheap energy and use it at a different time. Are there subsidies to overcome the start-up costs?

The final and mostly ignored aspect is the size of the potential first mover group amongst the customers, I.e. will there be enough business to actually gather enough experience to make the scale advantage happen. Linked to this is also the recommender effect, if there are a diverse group of first movers more people will hear about the heat storage and will consider it as an option. Finally there is the question of how much competition there is. Some similar but not same options are actually very good, as it means people have a choice, and are therefore able to have a better fit for their needs. Also, if there is just one such product, people might wonder, if it is a good idea.

Once all these different dimensions are established, their current state is determined and all of them are translated into numerical values. The human or societal factors can be incorporated as costs into a choice function, making a certain choice more or less likely. The choice function encodes the relationship between all the factors named above and the sales of the product.

Then finally for the encoded parameters different developments into the future are assumed to form the scenario. To get a good idea of the risks and opportunities many different developments are generated to cover a wide variety of situations. Because these scenarios do cover all those various aspects, they allow companies to revisit decisions, whenever the actual situation changes or even starts to change. This approach also allows to incorporate any new insight about the product, process, or the customer base.

Scenario modelling is highly customer dependent, so there is no fixed indication of the costs possible. But as with all our solutions it is possible to agree a project price up front, or to pay by effort, i.e. by actual delivered hours. The effort will generally be several weeks to collect information and build the necessary mechanism to assess market developments. If you are interested, please send a request using our contact page.