How can Blockchain create a more sustainable energy market? Dr. Sarah Hambridge
Blockchain technology is the basis of cryptocurrencies and decentralized applications. Blockchain covers today areas like finance, healthcare, entertainment, gaming and supply chain management - and has all the coordinates to transform the energy distribution network into a more intelligent, sustainable, and efficient one.
Grid Singularity is an awarded, open source energy technology startup, placing the individual and the environment at the centre of the energy market by developing the energy exchange and cofounding the Energy Web Foundation (EWF). Grid Singularity simulates and operates interconnected grid-aware energy marketplaces, facilitating market participation by connecting aggregators and grid operators through an application interface. Meet co-founder, Dr. Sarah Hambridge, at Future Summit in Bucharest in May 20 for an important conversation on how to make energy more sustainable through the power of Blockchain systems.
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Why and how can Blockchain become a tool for sustainability?
Blockchain can be used to decentralize and automate systems while also bringing greater trust and transparency. Decentralization allows members to join and interact with a system faster, allowing for greater scalability, stability, and impact. By becoming more transparent, members can interact with each other without relying on a third-party certification or middleman identifier. These attributes of blockchain technology can be used to bring people together in systems promoting sustainability, by identifying the origin of energy or tracking carbon emissions, for example, or by growing networks of people installing and trading renewable energy.
How do you see the impact of technologies such as Blockchain in the current energy and future energy crises?
I see a couple of main use cases for blockchain in the energy sector. To start, blockchains can be used to track the origin of energy (is it renewable or not?) and also the carbon emissions of different products and services. These origin of emission certificates can then be accounted for and traded. Using blockchain helps keep track of certificates by automating the system and preventing double-counting. As a step further, energy assets can be registered in a decentralized registry which then gives the asset and owner an ID that can be used to track the asset’s output and permissions in an energy system or network. Further, as the basis for energy communities, blockchain can help facilitate rapid onboarding of energy users who join communities, buy energy assets, such as PV, electric vehicles, or smart home appliances. Within the current and future regulatory framework for energy communities and energy retailers, blockchain can be used to manage the rapid onboarding of users and grid management of large numbers of distributed renewable assets, like rooftop PVs, electric vehicles, and smart home appliances. Previously, electric grids followed a top-down model of centralized energy production and management. In order to accelerate the energy transition, a decentralized approach allows for faster onboarding and management of everyday energy users and their smaller, locally installed, renewable energy assets.
Why is this revolutionary in terms of energy production, and how will this help decarbonize our lifestyles?
Traditionally, and in many ways today, energy is produced in large, centralized plants, and managed by grid operators in a top-down approach. Grid Singularity’s exchange inverts this model to allow for energy production and trading at the distribution level, or level of individual households and energy consumers. This approach enables individual consumers to trade in their local communities as well as across the wider grid. This approach is revolutionary in that it allows individual consumers to take full control and autonomy over their energy use and preferences. In addition to advocating for the national commissioning of renewable energy plants, individuals can install their own assets at home and offer their excess energy at a price of their own choosing, enabling a plug-and-play approach to transitioning to cleaner energy sources. In addition, the open market model of Grid Singularity’s exchange allows for transparent and reactive pricing, tying into the transactive grid concept. If consumers can set and react to the real price of energy in a given time span, they are incentivized to operate assets or adjust their behavior in order to increase the percentage of renewable energy consumption or store it for later periods. At the end of the day, local energy prices also help grid operators maintain the balance of supply and demand on the grid, and to become more self-sufficient, lowering prices that consumers pay to keep the grid stable.
What are the benefits at the individual level and in terms of the environment when we look at the center of the energy market?
When we look at the benefits at the individual level, the terms of decentralization, democratization, decarbonization, and digitalization come to mind. People today are connected to their families, friends, and communities digitally through social networks and the internet. In order to involve everyone in the energy transition, which will help accelerate it, we have to build individual and community relationships with our energy use as well. And part of opening and decentralizing energy markets is to allow consumers to become active participants rather than residents who simply pay the bill each month. This relationship democratizes the energy system and empowers users to make their own energy choices. When consumers can work together and in communities to sell their own renewable energy, invest in energy storage, and optimize their consumption, we will be able to reach a carbon-neutral world much faster and with a more educated and engaged population.
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Future Summit 2022 is the largest event in CEE focusing on future trends and sustainability, organized by Social Innovation Solutions. FS is supported by Raiffeisen Bank Romania and eMAG.