# Draft: Business Models for the NFE Microgrid OS

Nearly Free Energy (NFE) Microgrid OS needs a clear model for generating sustainable revenue while enabling community energy systems. Two primary deployment models are proposed.

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# 1. NFE-Owned Microgrid Model

In this model, NFE owns and finances the microgrid infrastructure within a community.

## Infrastructure

NFE provides and owns:

- Submeters
- Battery storage
- Solar generation
- Microgrid control infrastructure running NFE Microgrid OS

## Commercial Structure

NFE signs a Power Purchase Agreement (PPA) with the community, landlord, or HOA. Residents then purchase electricity directly from the microgrid.

## Revenue

NFE earns revenue through:

- Electricity sales to customers
- A reliability premium for improved power quality
- Optimization of solar and battery storage to improve margins

## Key Tradeoff

This model captures the most revenue but requires significant upfront capital and operational responsibility.

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# 2. NFE Partner Microgrid Model

In this model, a partner owns the infrastructure while NFE provides the operating platform and technical services.

Typical partners include developers, landlords, housing estates, or community energy groups.

## Infrastructure

The partner finances and owns:

- Solar
- Batteries
- Submeters
- Inverters and control hardware

## NFE Role

NFE provides:

- NFE Microgrid OS platform
- Billing and settlement
- Monitoring and remote management
- Deployment and Operation of supported hardware

## Revenue

NFE earns through:

1. **Monthly Platform Fee** – a fixed charge per connected customer
2. **Revenue Share** – a percentage of net monthly electricity sales

## Maintenance

NFE maintains supported hardware such as meters, batteries, and solar systems. Costs are paid by the partner. Third‑party assets (e.g., diesel generators) are excluded unless separately contracted.

## Partner Revenue

Partners earn revenue from electricity sales and reliability improvements. They may also charge additional services through the NFE Microgrid OS billing platform.

## Key Tradeoff

This model requires little capital from NFE and scales faster, but NFE captures less revenue per microgrid.

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# Strategic Use

Both models can coexist:

<table id="bkmrk-situation-preferred-"><thead><tr><th>Situation</th><th>Preferred Model</th></tr></thead><tbody><tr><td>Communities lacking financing</td><td>NFE-Owned</td></tr><tr><td>Developers or landlords</td><td>NFE Partner</td></tr><tr><td>Existing estates</td><td>NFE Partner</td></tr><tr><td>Demonstration projects</td><td>NFE-Owned</td></tr></tbody></table>

NFE may ultimately operate a hybrid portfolio—owning a few strategic microgrids while enabling many partner-operated systems through the platform.

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# Questions for Team Feedback

1. How should we determine the monthly platform fee per customer?
2. How should we determine the appropriate revenue-share percentage for the partnership model?
3. What hardware should NFE officially support and maintain?
4. Should partners be required to use NFE‑certified hardware?