Blockchain For Energy & Utility
The energy industry is changing
This is something we often occult on our path to energy transition, the number of energy- related products is exponentially rising: vehicles, computers, air conditioners, smartphones, servers, household appliances etc…We increasingly use our resources to create energy, but mainly because there are more and more products that need to be empowered.
To understand what role blockchain plays in our future, we have to look at the big picture. The P&U industry is hurtling toward three critical tipping points which will herald a new and very different era for energy:
- Off-grid energy will reach cost and performance parity with grid-delivered energy — from 2021.
- Electric vehicles will reach cost and performance parity with combustion engine vehicles — from 2025.
- The cost of distributing energy will exceed the cost of generating and storing it locally — from 2039.
Despite more and more people installing solar, the price hasn’t dropped. In fact, to some extent it goes the other way and becomes more expensive. This is quite a counterintuitive state of affairs and it reflects the complexity of the electricity market.
The networked infrastructure of the energy industry makes it particularly suited for blockchain technology applications. And with the rise of IoT, the entire energy industry may soon find its operations transformed into a vast global network of connected devices all feeding digital data into blockchain-enabled platforms that can capture and share information in real time. Here’s a closer look at four specific use cases that illustrate blockchain’s potential in energy and resources.
Regulatory reporting and compliance
Global supply network
Asset optimization across sectors
A distributed ledger will make it possible to facilitate machine-to-machine, smart- contract-based interactions. Devices could understand each other and be able to automatically cooperate and transact.
For—example, smart home appliances—such as a smart plug or smart meter connected to an energy trading platform could continuously look for the best offer and automatically alternate to a new energy provider through a smart contract. This would become an effortless experience for the customer, yet allow them to interact via their home directly to energy spot markets. A number of start-up platforms have emerged to solve basic problems related to bill settlement and prepaid recharge of smart meters using cryptocurrencies.
Renewable Energy Certificates
Currently, When a renewable-power plant generates a unit of electricity today, a meter spits out data that gets logged in a spreadsheet. The spreadsheet is then sent to a registry provider, where the data gets entered into a new system and a certificate is created. A second set of intermediaries brokers deals between buyers and sellers of these certificates, and yet another party verifies the certificates after they are purchased.
Inaccuracies could be reduced using sensors paired with smart contracts that record data to a blockchain ledger and issue or trade RECs based on actual energy produced. There is no need for a central agency to verify generation data or work through costly and inaccurate estimates because accurate data is instantly viewable and actionable on the secure ledger. Blockchain can reduce costs for public agencies administering RECs by streamlining trade verification and data indexing.