Blockchain is already proving its ability to provide secure transactions by applying smart contract technology. With its trustless network, blockchain can also be implemented when establishing trust is a key criteria for the success of the business model. Due to this, the banking industry is currently leading the way with blockchain experimentation.
How can the technology be used in utilities then? Blockchain-based technology (both permissioned and private ledgers) can be applied to numerous processes, such as energy credit management, the promotion of green energy, asset optimization, payments within microgrids, prepaid smart meters and payments to distributed generation asset owners. These are among the many use cases that industry players are exploring via pilot projects.
We also believe blockchain-based networks can help utilities disintermediate suppliers and even retailers throughout the electricity market. Over time, all import and export electricity meters could be fitted with blockchain nodes, and these meters will be able to plug into a single power exchange to directly transact electricity among themselves. This power exchange would run on top of a more scalable and permissioned blockchain platform, thus creating a more efficient market. Currently, blockchain scalability is a challenge for industry-wide applications.
Before embarking on a blockchain journey, however, it is critical to understand the strengths and weaknesses of the technology and how it can be best applied to solve business challenges and achieve strategic objectives. This white paper will evaluate blockchain as a technology option for streamlining operations, decreasing costs and delivering on the promise of the distributed smart grid.