Hans-Christian Busch, Tobias Dauth, Luise Fischer, Marcelo Souza

• This paper aims to shed light on sustainability oriented frugal innovation. We explore how frugal approaches to innovation can be used as affordable and environmentally sustainable alternatives to established water heater systems. Using a descriptive case study approach, two examples of frugal innovators in Brazil are being depicted. We develop a better understanding how frugal approaches to solving similar environmental problems vary between different organisational forms. Moreover, we investigate in which situations a frugal approach to sustainable innovation appears to be suitable. Our findings indicate that distinct approaches to frugal innovation can be pursued developing environmentally sustainable and affordable technology. Comparing a grassroots non-profit organisation to a for-profit corporation, we identify different degrees of relational importance of frugality in environmental sustainability. We show that frugal approaches represent viable alternatives in achieving circular products and that these approaches can contribute to a socially inclusive form of environmentally friendly domestic energy use.