What Future Holds for Blockchain in the Energy Sector?
image credit: Image used with permission.
- Sep 20, 2019 11:26 pm GMTSep 20, 2019 11:25 pm GMT
- 1318 views
This item is part of the Special Issue - 2019-09 - Blockchain in Utilities, click here for more
I have always been intrigued by technology and the way it evolves and makes our life easy. So making a career out of it came quite naturally. The years spent in Silicon Valley helped me hone my knowledge and skills into becoming the professional that I am today.
When blockchain debuted alongside Bitcoin in 2009, it marked the beginning of a revolution in the technological sphere. It might have been introduced to us through cryptocurrency but the blockchain is so much more than that.
In the first leg of blockchain development, it got adopted mostly by the fintechs and banking sector and it was an instant hit. I had the opportunity to initiate the first interbank Trade Finance and Remittance implementation of blockchain between two of the largest global banks, and it was an enriching experience.
However, today after 10 years since the first appearance of the blockchain, we can see its implementation in almost every sector such as transportation, supply chain management, healthcare, government, advanced automation services like IoT and most importantly the energy industry.
How Blockchain is disrupting the Energy Sector?
Blockchain technology has opened up broader avenues in the energy business. If we go by statistics, there are several emerging pilot projects involving blockchain in the energy sector. As per the market review, it is expected to grow at 60 percent by 2025, which can be estimated to a value of USD 3 billion.
P2P energy trading
The great thing about blockchain is that it has very low transaction costs. That will allow the prosumers or small energy producers to distribute and sell the energy that they produce. The smart contracts can manage real-time data taken from solar panels and assist in two-way energy flow through the network.
It can help in the formation of a power grid that will facilitate partnerships between power companies and the prosumers. Blockchain-based apps can help consumers to control and keep a track of the daily energy usage, thus helping in energy conservation. It will generate a good amount of revenue in the years to come, not to mention acts as a boon to renewable energy production and distribution.
Smart contracts for the electric vehicle charging station
Electric cars are great for several reasons such as low emissions, more economical, easy maintenance, etc. But the problem arises when you are out to find a charging station, because let’s face the facts here, even though the biggest names in the automotive industry are launching new EV models people are still skeptical to invest in one, for just that reason.
Blockchain can come as a boon in this sector, through the creation of applications that will allow consumers to share their EV chargers with their peers. The use of smart contracts in such an application will make the transaction via crypto tokens easy, less time consuming and efficient. There are commercial charging stations in place, however, private EV charging stations such as call of the hour. It will be highly beneficial to the consumers and facilitate an energy demand that will be fruitful for the industry.
Management of supply and demand in the energy market
There is a recurring issue of tackling supply and demand in the current energy sector, and there is an urgent requirement of flexibility and scalability in the services that will match the supply with increased demand and so forth. A blockchain-based app can keep a check on the consumption of energy and help in proper management. Apart from that, there can be a flexible platform for trading and transactions that will make it easy for consumers to avail of energy services.
This is just the tip of the iceberg when it comes to what blockchain can do for the energy sector. There are lots of possibilities and scopes that need exploring in decentralized ledger technology.
My experience with blockchain so far has made me believe that applied in any sector, the technology will make the management of data seamless and also make the process more transparent to all the parties involved. Hopefully, we are looking at a profitable future for blockchain in the utility sector especially in the energy industry, with the promise of exponential growth.