Energy

Laurent Hardy

Icons by TheNounProject

Photo by Boris Smokrovic on Unsplash

Through Blockchain

Jose A. Bernat Bacet [Getty Images]

generator

transmission

distribution

consumer

markets

grid

retailer

money

electrons

In Deregulated Markets

The System Operator establishes the generation that is required according to the estimated demand for electricity

This in turns generates signals to the market that allow participants to respond

Wholesale market

Ancillary market

Demand Response market

Electricity vs. Commodities

Commodity

Usually sold as future contracts for cash because contracts can be settled in advance

Electricity

Usually sold as forward contracts because contracts are settled in the delivery of the electricity

 

vs.

Low Energy Storage

Production and consumption happen in realtime

The product is created and destroyed instantaneously

Financial Markets

A delay is needed, it cannot settle instantaneously.

Utilities don't know for how much they will settle.

A process of collateralisation and segmentation is required.

Utilities act as intermediaries to eliminate counter party risks from the other market participants in case customers don't pay their bill.

Flat rates

Utilities usually mark up their retail price of electricity a 100% over the average cost

This is the price of collateralisation users have to pay to avoid the counter party risks they represent

Blockchain solutions

reduce the need for collateralisation

Photo by William Bout on Unsplash

Demand Response

Great for large consumers,
not for small consumers

MWh

Predicted electricity demand for large industrial or commercial consumers

Predictions are done manually according to the activity of production.

In exchange for economic compensation, the consumer agrees to shift his consumption or avoid consuming at that time of the day.

time

MWh

Predicted electricity demand for small residential consumers

Smart thermostats can make accurate predictions about electricity consumption.

No aggregators appear to be willing to pass through the price the shifting of very small quantities of electricity consumption.

MWh

MWh

MWh

By aggregating customers, financial incentives to include small residential customers in the demand response markets might arise

smart meters, digitalisation, big data, virtual power plants

Photo by William Bout on Unsplash

Blockchain solutions

allow customers to interact directly 
in the wholesale market

Green energy is great...

...but it causes problems

Intermitency

Misalignment

morning demand

afternoon demand

solar generation peak 

Grid dependency

Who pays for the grid?

Energy storage

smooth the mismatch between production and consumption of electricity

Unbalanced Financial Optimum

1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24

Net Capacity
(excluding renewable sources) the grid operator needs to have in order to cover the demand at all times

2012 (actual)

2014

2015

2016

2017

2018  2019

2020

2013 (actual)

Photo by William Bout on Unsplash

Blockchain solutions

embedded intelligence could eliminate problems of intermittency, misalignment, storage and grid costs by creating new electricity markets where renewable energy systems can operate at financial optimum

Blockchain solutions

21 projects | 13 countries | ~$100m raised

Conjoule

DAISEE

Drift

ElectricChain

Electron

Energy Web Foundation

Filament

Freeelio

Greenum

Grid+

Grid Singularity

ImpactPPA

LO3 Energy

M-PAYG

MyBit

NRGcoin

Power Ledger

SolarCoin

Sun Exchange

Volt Markets

wePower

Blockchain solutions

21 projects | 13 countries | ~$100m raised

P2P electricity trading platform

Conjoule, DAISEE, Drift, Electron, Energy Web Foundation, Greenum, Grid+, ImpactPPA, LO3 Energy, M-PAYG, MyBit, NRGcoin, Power Ledger, Volt Markets, wePower

P2P crowdfunded infrastructure

ImpactPPA, MyBit, Sun Exchange, wePower

P2P electricity data exchange and communication

ElectricChain, Filament, Freeelio, Greenum, Grid Singularity, SolarCoin

Photo by Samuel Zeller on Unsplash

Blockchain solutions

scaling problem

P2P electricity trading

  • Few people have solar

  • Fewer people have solar and storage

1.6% households
in the world
have solar

< 1% households
in the world
have storage

The grid doesn't know about specific electrons

Wholesale market electricity trading

There is a 100% collateralisation necessary to avoid counter party risks

Almost anybody would love to pay less on their electricity bill

30–40%
cost reduction?

Crowdfunded green energy projects

Substantial potential, especially now that conventional funding is flattening or decreasing

Lots of uncertainties regarding funding projects with blockchain, security, identity, governance, legal status, dispute resolution

blockchain

dispute

legal status

governance

identity

security

do not

trust

me

do research, learn the technology,
test the product, engage with the community, compare with other projects, read the documentation, look for red flags

Photo by Rodion Kutsaev on Unsplash

Welcome to the Future of Energy

  • Store energy data
  • Learn about consumer habits and predict energy consumption
  • Do computing to take decisions about energy trading
  • Generate private keys within a secure enclave environment to sign transactions
  • Create a multisig wallet to offer the desired level of security
  • Manage accounts permissions to access the device and perform actions

Smart Energy Agent

market data

smart meter

smart agent

data

data

payment is based on the consumption of the last 15min

Electricity consumption 

market data

smart meter

smart agent

data

data

Electricity generation 

payment is based on the generation of the next 15min

data

State Channels

ERC20

Alice wants to pay Bob

Bob

Alice

Alice open a channel by locking 9 tokens in it

Alice can start making payment to Bob

When the channel is closed, the remaining tokens are sent back to Alice

source: Raiden Network

Dual Token Model

philosophy: all the users are naive users

Bolt

Created by Grid+

The user makes a deposit

Stable 1:1 token backed by dollars

Bolt tokens are sent to the user

The smart agent spends Bolts

Grid+ then destroys it and move money from the deposit to pay for the electricity consumed

Grid

Redeemable to remove markup on 500 kWh of electricity (Grid+ would normally charge 30% markup to the user)

It allows the user to pay electricity at cost

Each token would save the user around 10–15 dollar worth of electricity (depending on the local price of electricity)

Innovation at the edges

IoT / Smart Home integration

HD wallet functionalities

Photo by Benedikt Jaletzke on Unsplash

Shared ownership

Invest in energy assets in the form of equity to share the profits the asset will generate in the future

Energy trading

Trade energy P2P or through a host platform where utilities can on–board their customers

Energy data

Generate, store, analyse, learn and share data related to energy production and consumption

Communication

Connect to third parties to leverage Power Ledger services and capitalise on users achievements and assets

Dual Token Ecosystem

A way to make Power Ledger operable internationally,
and to protect consumers against badly managed Application Hosts

POWR

allow Application Hosts and Participants access to and use of the Platform (like a limited software licensing permission) anywhere in the world

SPARKZ

issued against escrowed POWR tokens, via a Smart Bond, and used by the Application Host to onboard its customers

Application Host

P2P Direct

Buy POWR tokens

Buy POWR tokens

POWR Smart Bond
generates SPARKZ

POWR converts to local market SPARKZ

consumers

prosumers

Application Hosts
sells SPARKZ

prosumers
generates energy

P2P consumers
buy & trade SPARKZ

$

SP

SP

$

kWh

SP

SP

kWh

Incentives

Green Energy Loyalty Rewards

rewards prosumers and consumers of green energy with POWR tokens collected as fees on every P2P transactions on the platform

User base growth

the demand for the POWR token will likely increase

Green Energy Generation Initiatives

donation of micro-portions of the transactions to innovative and sustainable energy projects

Blockchain infrastructure

Ethereum public blockchain

EcoChain consortium private blockchain

Global access to capital for projects

Global access to investments and trading (i.e. liquidity)

Speed and transparency

WePower = platform that acts as an independent energy supplier

energy buyers

(households, investors, market makers)

energy producers

tokenisation of future energy production

data

data

data

Internal Energy Token

Each energy token acts as a smart contract, specifying:

  1. The type of energy
  2. When the energy will be produced and delivered
  3. A price tag

The smart contract represents a standard power purchase agreement between the renewable energy producer and energy buyer.

Blockchain Energy Consumption

Feedback is welcome.

Thanks.

Energy Through Blockchain

By Laurent Hardy

Energy Through Blockchain

Perspectives on the energy sector of today and why blockchain might be a suitable solution for its problems. A review of the international scene of the main players involved and a small selection of outstanding projects that are pushing for the adoption of their innovative solutions.

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