The World – s Top Energy Companies Look to Blockchain to – Fuse the Physical With the Virtual, Greentech Media

The World’s Top Energy Companies Look to Blockchain to ‘Fuse the Physical With the Virtual’

A fresh coalition links up energy companies with leading blockchain experts.

A fresh coalition links up energy companies with leading blockchain experts.

Earlier this month Shell, Statoil, Tepco, Centrica and a half-dozen other energy companies joined the Energy Web Foundation, an alliance dedicated to bringing blockchain to the grid.

The companies donated $Two.Five million to the organization.

The foundation was set up in February this year as a collaboration inbetween Rocky Mountain Institute (RMI) and Austrian blockchain developer Grid Singularity to “accelerate the commercial deployment of blockchain technology in the energy sector.”

The companies and organizations involved think blockchain will be a game-changer for energy, and are working together to provide the frameworks and standards to help ensure that outcome.

Jesse Morris, principal for electro-therapy and transportation practices at RMI and co-founder of the Energy Web Foundation (EWF), said the foundation’s instant aim is to garner more affiliates and funding, while developing an open-source blockchain application for use in the energy sector. Primarily, playmate organizations will evaluate the software, and potentially release it to the public in two thousand nineteen or 2020, if all goes well.

Blockchain is best known as the platform for Bitcoin. It is an encrypted, distributed database that permits all users to track every transaction — thus eliminating the need for an intermediary.

Blockchain enthusiasts believe the technology can also be used to seamlessly transact electrons inbetween consumers on the grid, while keeping an accurate, incorruptible tally of where they came from and where they went. It could encourage greater peer-to-peer sales on the grid and lay the foundation for microgrids and distributed renewables.

“We have a strong hypothesis that blockchain will solve a lot of long-running problems in the energy sector,” said Morris. “Overcoming these challenges could make puny, incremental switches to energy infrastructure and markets in the near term, while others would be more far-reaching and disruptive.”

Certificates (also known as ensures) of origin would assure the user that a particular megawatt-hour of electro-therapy was produced from renewables. According to Morris, the U.S. alone has ten different tracking systems, Asia-Pacific has several more, and each European country has its own system of certification. Blockchain could be used to transparently ensure the origin of the electrons.

Longer-term, and more radically, RMI sees the future of electrical play networks being driven by the billions of energy storage and HVAC units, EVs, solar roof panels and other devices and appliances at the grid edge.

Blockchains can permit any of them to set their own level of participation on the grid, without the need for an intermediary. And crucially, they can be configured so that if a grid operator needs assured capacity, the grid-edge unit can communicate back to the grid whether or not it’s up to the task.

This is an example of what Morris described as blockchain’s capability to “fuse the physical with the virtual” via machine-to-machine communication.

However, these are still early days. Foundation members have a lot of work to do in order to ensure its credibility, prove the technology works for energy applications, and lay down the foundation for widespread adoption.

“Think of it like the App Store,” remarked David Peters, director of strategy and innovation at grid owner-operator Stedin B.V. “We at the EWF are building a collective infrastructure where we can build on top the developed code.”

Stedin joined EWF because it believes in blockchain’s potential. “It gives us access to the best blockchain people in the world,” Peters said.

He hopes the widespread adoption of the technology will “lower the barriers of participation” for the grid.

Engie, the French multinational electrified utility, had already conducted its own blockchain research projects before joining EWF. Among them was a program to track brainy meters in Burgundy, keeping detailed tabs on solar panel electric current production, and facilitating transactions of a puny peer-to-peer community energy trading project in Belgium.

Engie’s Director of Research and Technologies Raphael Schoentgen explained that blockchain is a promising technology to track clever meter data. “It contributes to better management of electrons over the grid,” he remarked.

The technology’s capability to automate transactions for peer-to-peer trading is of key interest to Dr. Hans-Heinrich Kleuker, the CEO of Technische Werke Ludwigshafen, whose company is now also part of EWF.

“We’ll see many more consumers with either an energy deficit or a surplus in the near future, and the desire to trade that energy,” he said. “Machine-to-machine communication, such as that suggested via blockchain, will be essential to manage the vast number of transactions needed.”

Such trades would certainly be beyond the capabilities of a petite, local utility such as TWL, said Kleuker.

“We are looking at the convergence of different electrical play markets, which are very different right now, but longer-term will be facing similar challenges,” Kleuker concluded, persuaded that the application of blockchain can meet those challenges.

EWF will meet at the end of May to determine which use-case scripts from around the world it will employ to take the project forward.

In the coming years, the foundation will determine on norms and standards that may permit blockchain to be used in a truly universal way and “budge beyond the hype.”

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