Decrypt’s Art, Fashion, and Entertainment Hub.
The global energy market is worth $2 trillion, and is set to keep growing as more of the world’s population turn on the lights for the very first time. But the way energy is created and distributed needs to change. Not only is burning fossil fuels accelerating climate change, but the old model of a centralised grid system is costly, inefficient and prone to disruption. But there are signs things are changing, and blockchain is playing a big role in the energy industry.
We explore five companies helping give power back to the people.
Allowing people to buy and sell their own electricity with Power Ledger
Your power supply is sent to you via a centralised system that locks prices in months before you switch on the lights. That means that when it comes to consumer choice - not to mention adoption of renewable sources - consumer choices are limited.
Centralised grids aren’t great at handling renewable resources, favouring more stable fossil fuel energy production. But companies like Power Ledger are shaking things up.
Power Ledger enables regular people to easily rent out their excess to their peers, like the AirBnB of electricity.
The company is already using blockchain in the energy industry and running projects in areas as diverse as Thailand, India and the US. In Bangkok, they have created a 100% renewable micro-grid in the heart of city. In India, the team created a distributed micro-grid for rural customers who’d never had electricity before.
Distributing power without the need for new power lines with TenneT
As renewables generate an increasing proportion of our power, it gives rise to a number of opportunities, but also challenges. One of the biggest problems comes with how to manage irregular periods of energy production. On cloudy, wind-less days generating energy can be a struggle.
On top of that, there are other challenges including building new infrastructure to allow new power sources to integrate with old grids.
When power is needed, the network draws from these mini-storage locations, helping to create a balanced power grid without the need for more power lines.
The network can even compensate customers who give electricity to the network, helping make energy production and storage a more community focused experience.
Creating a carbon trading platform with Energy Blockchain Labs
While the need for lower emissions is greater than ever, there are still processes and industries that produce a lot of CO2. That’s where carbon trading comes in.
Carbon trading is a marketplace whereby high-emission producing companies can buy credits from low-emission producing ones.
But, there’s a problem. These markets take months or even years to create, and there are questions over who manages this system and how that management is regulated. That’s where Chinese company Energy Blockchain Labs comes in.
Thus far, Energy Blockchain Labs has compiled more than 200 carbon asset development methodologies into smart contracts, which allows the blockchain to automatically calculate the quotas enterprises need to stick to in order to reduce emissions.
That frees up companies so that they can easily and simply offset their carbon, or sell their carbon credits for profit.
Making it easier for consumers to switch energy providers with Electron
Changing energy provider can be a frustrating business. Not only are energy prices fixed ahead of time, consumers can be restricted when it comes to which companies they can choose, especially in remote areas.
While governments have tried to enforce and increase competition, change is slow. However, companies like Electron want to make switching as easy as well, putting on the kettle.
Starting in the UK, the company has built a decentralised record on the blockchain that records who is signed up with which supplier and what assets they are using; solar panels, batteries, smart meters, EVs and so on.
Currently, because there is no central register of all electricity and gas meters, it can take between 17 and 20 days to change utilities in the U.K. A blockchain could cut this time to “mere minutes,” Electron believes.
That lays the groundwork for a future where the network can balance out demand and supply automatically, while simultaneously allowing customers to instantly swap their providers, as their accounts will no longer be sat in single silos owned by centralised companies.
Rewarding consumers for saving energy with Energi Token
Energy companies don’t provide many incentives to save energy. Beyond reducing a customer’s bill, energy companies make more money the more power you use. Which is fine for energy companies, but not so great for consumers - and the environment.
Energi Token wants to change that.
The company’s blockchain solution will create a platform to reward energy efficient behaviour through its EnergiToken. The more energy-efficient behaviour someone exhibits - taking low-carbon transport, buying energy-efficient appliances - the more they earn.
Those tokens can then be re-used in the company’s eco-system to trade energy or charge your electric appliances for free.
The energy industry is changing. Decentralization, digitization, shifting demand and prices, and desire for greater sustainability are all starting to shift the way energy is made, transferred and sold.
Blockchain in the energy industry- and the above startups - illustrate that there are a number of ways power can become cheaper, more widely available and more democratic.
All of which gives power back to the people.