A new business opportunity is emerging with the combination of three key market trends: (1) Increased penetration of residential solar PV; (2) Rapid reduction of battery costs; and (3) Emergence of prosumers. This article proposes an innovative business model to harness the potential of aggregating behind-the-meter residential storage. In its simplest form, the aggregator compensates residential storage system owners for using their battery on an on-demand basis. An optimization model was developed to evaluate the potential of this proposed business model and determine the ideal compensation scheme for the participants. This study confirms there is a business case for utilities to implement such a business model. The main driver for the definition of the appropriate incentive is the compensation for usage which is based on a percentage of the resell price of the electricity used for arbitrage. Based on the Rhode Island data, participants could save on average $100 per year on their energy bills. Reciprocally, the utility (acting as an aggregator) could make profits of approximately $100 per participant. Given the growing number of customers with storage systems, these earnings could represent an important source of revenue for the utility. Our results also confirm the year-round profitability of the model, that could bring regular income for the utility. Moreover, additional profits could come from providing ancillary services, although these have not been quantified in this study. The utilities would also benefit from the flexibility provided by these distributed storage units, to address congestion problems and defer upgrades. All this would be possible without capital investment in grid-scale storage.