Power Ledger is revolutionizing energy sources using blockchain
Power Ledger is an operating system for the new energy markets, helping the world transact energy. The platform helps enable tracking, trading, and flexibility services related to renewable energy resources. The firm is helping its clients track, trace, and transact every kilowatt of energy. Power Ledger is working towards the global democratization of the energy market. Following renewable energy undergoing a global transformation, the firm aims to offer the platform for a fully modernized market-driven grid that provides consumers a choice in power.
Recently, Abhiruk Bhattacharyya, community manager at The Coin Republic, interviewed Dr. Jemma Green, the Co-Founder, and Chairman of Power Ledger. The session covered a range of exciting topics related to the potential of blockchain technology in the renewable energy sector.
“As a software company we use the blockchain to facilitate tracking and trading of electricity, trading of flexibility services, which stabilize the grid and track trading of environmental commodities related to electricity. So, renewable energy certificates and carbon credits.”
How is Power Ledger making a difference in the energy sector?
Blockchain technology is basically a decentralized form of processing information. To tell about the difference Power Ledger is bringing in the energy sector, Dr. Jemma used an example of one of the firm’s clients in Australia.
“I just signed up a client in Australia with Carlton United Brewery, which is one of the largest beer makers here in Australia. And it’s actually owned by a Japanese company now called Asahi, they are using our platform, buying rooftop solar framed households peer to peer and paying them in cartons of beer delivered to their house. And there are many corporate brands that have sustainability commitments and also would like to engage with their customers more and peer to peer trading like this, which we call loyalty peer to peer trading, or in this case, peer to beer trading. Being that the SOLAR effectively becomes a currency that can be traded for your favorite goods and services with your favorite brands.”
“So it could be used for supermarkets, food and beverage outlets, your telcos that provide your internet and your phone could buy energy from you and pay you in store vouchers and credit. And using our platform they can track and trade the energy and any household to log in and say how much SOLAR they have produced that’s been sold to the brewery and how much beer that equates to.”
Real idea behind blockchain-based renewable energy trade
Over the last 15 years, we have observed a lot of renewables have been installed in grids globally. Mainly such installations were driven by subsidies and faded tariffs. However, suppose we start to get high penetration of renewables in a system with centralized planning, like via a fading tariff. In that case, we begin to get renewables stored in the grid, not where it’s needed and not when it’s needed. Notably, the factor causes a significant issue in the grid related to upgrades like poles and wires, which are highly costly grid stability issues. Following the centralized scenario, Dr. Jemma stated how blockchain is helping solve several problems:
“To encourage energy, when and where it’s needed, means that you’ll have a more efficient system and be able to scale renewables without the headaches that we’re seeing in places where it’s being scaled using centralized planning and fading tariffs and subsidies.”
“The idea really is about growing renewables whilst keeping energy costs down, having a stable system, and also a low carbon system. Because even in places like Germany, where there’s high penetration of renewables, the centralized planning around that has meant that the system is quite unstable. And so it needs a lot of energy from coal, and gas to provide and supplement the system. So it’s actually not doing so well on the carbon side of things in spite of having more than 50% penetration of renewables in the system. And so, we think that if you actually put price signals in a localized sense and create local energy markets, you’re not going to be building.”
Tokenization of REC brings trust in transactions
Tokenization and Non-Fungible Tokens are something in craze in the current scenario. Notably, in the current scenario it is observed that Renewable Energy Certificates (REC) are getting tokenized. Such a certificate represents one megawatt hour of renewable power. Firms purchasing traditional energy sources can cover the amount of energy using such certificates.
Following the utility of the certificates it is clear that such certificates should not be sold out twice. Moreover, once used the users should not again claim next year using the certificate. Many in the blockchain industry considered that tokenization of such certificates could be a game changer. Following the point Dr. Jemma explained:
“More and more companies are starting to make these commitments about renewable energy. So the beer company I mentioned to you earlier, Carlton United Brewery has committed to get to 100% renewable by 2025. And this is very common. There’s a movement called the IRA 100. Renewable Energy a 100% basically is a you know, cut up big multinationals and even just large companies wanting things that’s really important to their brand. And if you buy certificates you want to know That it’s not a duplicate that it has it hasn’t been retired, that it’s real as well that it actually does measure a megawatt hour of renewable energy produced, then there’s a kind of another layer to that where some of the corporate leaders are wanting to actually match their REC buying against their load profile.”
“Certificates are a commonly used way by corporations to do that, but buying them all around the world in different countries can be really tedious and painful, and costly as well. And the contracting process can go on for a long time, and be very expensive, and be more expensive, perhaps in the value of some of the racks that are being purchased. So we think that having the ability to do that in a very efficient way is important for the maturation of the sector. And to reduce costs. You know, renewables should be cheap. And, it should be easy to do. So, the idea of tokenizing renewable energy certificates is really including within the certificate, unique identifying characteristics about when it was generated, where it was generated. And in tokenizing, it can’t be duplicated, and you can’t have it be retired and sold at the same time.”
Ultimately, Dr. Jemma clarified that such tokenization of certificates really adds a layer of security and trust to it. And having a REC on the blockchain means you can trade and settle it very efficiently between the buyer and seller. Hence, it reduces the current counterparty settlement risk.
Dr. Jemma also believes that anyone will be able to get on the system after 20 years from now. Users in the future will be able to connect and trade their energy from the electric vehicle, charge it, and can earn a little money while sitting at a restaurant. Power Ledger is working to bring a tremendous change. The service they are offering could bring a low cost, low carbon stable energy system for the world.
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