Blockchain has always seemed like a natural fit for the energy industry. With its distributed ledger, documenting and tracking capability — not to mention the ability to generate certificates or cryptocurrency, the technology is ideal for buying and selling renewable energy between households, between companies, and validating the transactions. And maybe even cutting out the middleman, which brings into question the role or usefulness of the utility companies. A report today from Bloomberg’s Energy Future Initiative discussed how blockchain is expected to help cut energy costs and assist in managing risk.
Most people in the industry have heard about the Brooklyn Microgrid project, a $6M effort that uses blockchain to automate and manage transactions between 60 energy suppliers, including solar households, and 500 homes with smart meters. Neighbor-to-neighbor energy transactions documented by blockchain have the potential to significantly streamline energy costs for consumers.
The next proving ground for the technology in the energy sector may be electric charging. Charging infrastructure can be quite complex, and blockchain has the potential to radically simplify the billing and payment process. Innogy SE has already set up thousands of charging stations in Europe using blockchain as a foundation.
Now, a US organization and an Australian blockchain company have teamed up with Silicon Valley Power to bring blockchain-based electric charging to California. The Clean Energy Blockchain Network, in Chicago, and Power Ledger, in Perth, have started a Santa Clara pilot program through Silicon Valley Power. The system tracks, manages and certifies low carbon energy generation from solar panels and batteries supplying one of the largest multi-story parking lot charging facilities in the area. The challenge is that there is obviously no way to ascertain what energy comes from what source once it is in the grid, which creates a large headache for power companies when it comes to independent verification of how much renewable power was consumed. Typically these transactions are tracked through Low Carbon Fuel Standard (LCFS) credits, which require a great deal of administrative work, but which can be sold to other firms seeking to offset their carbon emissions.
With the Power Ledger platform the 6 six-story facility will be able to monitor and record how much power is being generated and used, while the blockchain technology will also be able to digitize and issue Low Carbon Fuel Standard credits automatically. Not only will large EV fleet owners be able to use the credits, but the deployment of an automated approach means they can also be provided to individual EV owners.