Blockchain technology holds great promise in renewable energy markets. As individual consumers we have some idea of electricity markets work. We may know that if we shop around we get better prices, and if we don’t we won’t. There have also long been providers like Ecotricity that seek to provide us with electricity from renewable sources. These market mechanisms require individuals to act and make decisions. In our busy lives many of us stick with our existing energy providers and shop around only periodically.
Blockchain and smart contracts hold the promise to do this shopping around, and targeting greener energy objectives in an automated way continuously. This could be an enabler of great change in energy markets. Several companies have been set up with this objective in mind, and they focus primarily on businesses energy needs; but we can think of businesses operating like individuals but on a larger scale.
The change in energy markets could allow greater funding and targeted funding to be provided to renewable energy projects based on the changing market incentives.
There are 5 companies that are spearheading the initiative of blockchain in renewable energy markets.
1) WePower
2) Powerledger
3) Acciona energy & Iberdrola
4) The Brooklyn Microgrid
5) Sun exchange
The approaches have similarities. In this article the Lithuania based startup WePower is put under the spotlight (they would rather sun light of course).
WePower makes use of the ethereum blockchain to provide a ledger of transactions and to create smart contracts between electricity producers and buyers. They call the contracts digitally enabled Power Purchase Agreements (PPAs). They provide an ethereum smart contract enabled trading platform to buy and sell renewable energy.
Consumers and producers needs are assessed, and PPAs are drawn up to try to provide the best price for the consumer based on the available producers. WePower try to help small clean energy producers enter the market using this technology.
They have experienced significant growth and attracted a lot of media interest. It’s a fantastic example of how blockchain technology is being used right now to essentially make smart electricity markets.
