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Blockchain technology could create a paradigm shift in the energy sector, helping companies to move away from traditional business models with complex operational structures.
This is the opinion of GlobalData, whose analysts claim that blockchain has the potential to address the major challenges of electric utilities: high operating costs, outdated networks, security, regulatory compliance and personalized customer service.
Archi Dasgupta, GlobalData's Disruptive Tech Analyst, said: "Blockchain could be the main factor in decentralization, democratization and liberalization in the energy sector, using smart contracts, technology can enhance bilateral agreements in real time by eliminating the delays of intermediate points that lead to a significant reduction in operating costs of utilities ".
Dasgupta said that although blockchain technology has begun to scale, use cases are still largely dominated by proof-of-concept projects and small-scale production deployments.
"The large-scale commercial adoption is still three to five years as there are several challenges to be faced including installation costs, the power requirement to perform the installation and, above all, the need for develop common standards and regulations, "said Dasgupta.
"Power utilities are similar to banks in the way they are centralized and highly regulated, so it is crucial to create an ideal set for the implementation of transformative technologies like blockchain."
An analysis of the Disruptor Tech Database of GlobalData reveals interesting cases of use in the real world of blockchain in the power domain and selects startups and power companies working on them.
- The decentralization of power through the blockchain has given rise to trading platforms such as the one implemented in the Brooklyn microgrid by LO3 Energy where energy can be bought or sold directly within a peer-to-peer network ( P2P), eliminating the need for intermediaries. This will not only reduce the costs of both utilities and consumers, but also the transparency of the network.
- The Australian computerized company Power Ledger, known for the development of decentralized blockchain energy trading platforms, has launched its first commercial deployment in the United States. Its distributed P2P blockchain network allows consumers and businesses to sell their solar surplus in their neighborhood without an intermediary.
- The European transmission system operator The TenneT pilot with Sonnen using blockchain based on IBM's Hyperledger framework may allow energy storage systems within the network to absorb or discharge energy into excess in a few seconds and minimize transmission blocks.
- The Lithuanian startup, WePower, worked with the transmission system of Estonia Elering. WePower managed to load 26,000 hours and 24 hours of production and energy consumption data from the smart meters of Estonia on the Ethereum blockchain, which led to the creation of 39 billion smart marketable energy tokens.
- By exploiting the potential of blockchain, P2P energy networks are able to create a decentralized market that connects electric vehicle drivers (EVs) and owners of charging stations for mutual benefits. The German startup, Motionwerk, has launched a P2P-based share-sharing project based on blockchain Share & Charge, which allows users to share their private electric charging stations for money.
- Other startup examples that fly with blockchain to cut off electricity include Drift, Electron, FlexiDAO, Grid + and Riddle & Code.
