How
Blockchain Will Empower Renewable Energy

Blockchain
is a system of computer networks used to store large amounts of data and keep
track of complex transactions. It is designed to replace our current
client-server model and give authority back to the owners of every change or
transaction. There are many organizations now working on research and
development in test centers around the globe, creating partnerships with
blockchain developers to capitalize on the innovative potential of the
technology. The first institution to experiment with this technology was the
financial industry, hence the bitcoin. Now, green energy is processing the
blockchain in order to trade energy in a peer-to-peer system with consumers.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

For the most
part, energy is collected in large grid systems whose meters spit out data that
is logged into a spreadsheet. That data is re-entered to create a certificate,
then passed to another set of intermediaries who broker the dealing of the
certificates, then the certificates are verified again by another party, etc.
etc. Confused yet? Add on a transaction fee for each of these operations and
you have a very complicated and expensive system that is vulnerable to misuse
and lack of transparency. Regulatory hurdles, consumer acceptance, technical
challenges, and financial intricacies have been longstanding issues in the
energy industry, and ones that can hopefully be simplified or erased by
blockchain technology.

A blockchain
system allows energy producers to trade energy in a peer-to-peer organization
with consumers. Instead of dealing with the complicated grid system, the meter
would write the data directly to a blockchain. This would allow people to trade
energy with each other, instead of selling electrons back to the grid first.
Picture an apartment building with solar panels and storage batteries as a
mini-grid that can be tracked, recorded, traded, and used, and all of the
transactions are handled by a blockchain.

Power Ledger
is an Australian company that just started and has already raised $26 million
in an initial coin offering. Power Ledger is creating platforms for microgrids
in Thailand and India, as well as two in West Australia. There are also some
big-name companies like Shell and IBM conducting trials and microgrid projects.
This idea is still in its infancy, but could potentially advance energy and
utilities in the same way the internet ignited communications. As the energy
market opens up, blockchain offers a better way to handle all the challenges
involved in the $2 trillion dollars a year energy market and direct much-needed
funds to the renewable energy industry.

Also
contributing is the Energy Web Foundation, a non-profit organization that is
working on the privacy issues surrounding the use of blockchain technology for
the energy industry. The company has developed a platform to standardize the
applications of blockchain to help facilitate more efficient transactions. They
are the network validators who can whitelist specific power plants or
microgrids, and accelerate the technology on a global scale. Ten major companies
have signed on as affiliates and they plan to begin by tracking
renewable-energy certificates.

Many experts
agree that blockchain technology can ideally to transform modern energy grids.
In the future, homes and buildings could be equipped with software that
mechanically sells and buys power to and from the grid in real-time, cutting
out all the transactions in the middle. Right now, this brand of decentralized
energy makes up approximately 5% of the market and could grow to 25% of the
market by the year 2025. Blockchains offer a viable way to deal with the
complex relationships between users, retailers, and producers of renewable
energy.

x

Hi!
I'm Erica!

Would you like to get a custom essay? How about receiving a customized one?

Check it out