Can The Blockchain Fix The Energy Market?

The blockchain is a foolproof system that contains transactions that cannot be changed or hidden. This can allow for more integrity within supply chains in the free market. This may mean that it can add a level of transparency and absoluteness to the transaction made between clients and the energy company. The Guardian had written a piece discussing this concept.

Trading Energy
One existing project that may shape the way energy is sold is the Australian project named Power Ledger. It is a peer-to-peer market, much like Bitcoin, that allows energy shares to be traded with suppliers. This is mostly based around energy production by independent solar energy producers.

Those with solar panels on their roofs may sell excess energy to the electric companies, but many of them receive abysmal rates. Instead of selling at wholesale value, they may now use the blockchain-based Power Ledger platform to sell energy at competitive rates. Such economic incentives may hopefully drive the solar energy market and make this planet cleaner.

The company is currently in its testing phase in Australia, New Zealand, and Oceania. It is expected that there will be 500 or more active traders on the network by December.

The main concern would be that the blockchain will be unbalanced and will lead to the power belonging to a small core group of early adopters. The owner of Power Ledger assures us that their block chain is more efficient than the current Bitcoin blockchain.

Power Ledger uses the proof of stake protocol as they believe it is much more efficient. Ideally, it should use much less power and data consumption as the sluggish Bitcoin system.

Bitcoin is at a point where the network is driven by energy gobbling miners, and they are mostly in China. One Bitcoin transaction uses thousands of times more than a typical credit card transaction. Making transactions decentralized is coming at a cost to the sustainability of energy production. Perhaps if systems like Power Ledger would be adopted, Bitcoin may mostly power by clean energy instead of Chinese coal.

The other advantage of using Power Ledger will be to bring transparency to the energy market. Since raw data will be published, we will be able to visualize how much energy is being used, how many transactions are being made, locations that have the highest energy demand and perhaps more. There is too many smoke and mirrors set up with our current centralized energy providers.