“While energy-intensive cryptocurrency mining has caused a spike in carbon emissions, blockchain is a blank canvas capable of driving innovation in the field of green technology.”—James Ellsmoor
Energy: A human necessity of modernity. It is what we rely on for everything we do—from powering our smartphones, to lighting our homes and streets at night, to powering life support systems in the hospital ICU. Without energy and electricity—we are immediately thrown back to the dark ages. At the same time, we have a need to protect our planet from excess carbon emissions. With unchecked and abusive overuse of energy—humanity stands to irreparably harm our planet.
And now concerns of overuse of energy with cryptocurrency mining is on the minds of many environmentalists. James Ellsmoor notes in a Forbes article: “While energy-intensive cryptocurrency mining has caused a spike in carbon emissions, blockchain is a blank canvas capable of driving innovation in the field of green technology.”
Blockchain Reduces Carbon Footprint in Electrical Grid
“Blockchain technology has the potential to transform the energy sector,” says ConsenSys. The drive to reduce electrical power consumption has resulted in innovations such as: solar panels, electric vehicles, and smart metering. With its inherent properties, blockchain is emerging as the next technology to stimulate the growth in the energy sector with the Internet of Things (IoT), smart contracts, decentralized database technology, and systems interoperability.
While blockchain is not a cure-all for the on “how to proceed into the future of energy,” says Sam Mire, “it has several use cases that, at least on the surface, appear able to help facilitate a responsible, productive mission for the production and consumption of energy going forward.” Writing for the Disrupter Daily Mire evaluated a number of blockchain use projects that will help the electrical industry reduce its carbon emission output. The following is a review of these use cases.
To capture wasted energy, industry can create more usage-determined, and efficient ways of consuming energy. With the IoT and smart contracts—one way to set up “smarter systems of consumption” is by tokenizing energy trade. “Tokenizing energy so that it can be more easily exchanged between supplier and customer as well as through a customer-to-customer network.” The ability for producers to trade with consumers—based on varying supplies and demand—can improve the “viability of non-traditional energy sources.”
We are building a series of #dAPPs for the #energymarket. #Tokenizing REGOS, REC, #carboncredits and will enable #energy producers to sell their energy directly to #consumers peer to peer.#RowanEnergyBlockchain #DappOnline #peertopeer #Energytrading #apps pic.twitter.com/HCE7GCK2aN
— Rowan Energy Blockchain (@RowanEnergy) November 1, 2019
Centralized power grids has been the “crown jewel of engineering,” says Mire. However in the 21st Century, they’ve become known more for being inefficient and outdated resulting in massive amounts of energy losses. Studies have estimated energy losses due to resistance alone (the long distances electricity must travel) from 6 – 8%, costing over $19 billion each year, while losses from other sources can add up to over $70 billion every year.
Blockchain based microgrids are designed to address these losses. By creating local power grids—direct and concise systems will be able to reduce power loss.
P2P Energy Trading
With improvements in battery technology and energy storage—individuals will now have the opportunity to buy and sell their energy on a peer-to-peer (P2P) basis. The energy storage market is expected to double six times by 2030.
Investments into trading from energy storage capacity could save from $25 million to $50 million for “residential, commercial, and industrial consumers.” Most of the savings will likely come from users with greater control over energy trading, such as having the option to pay for energy when it’s needed. Moreover the customer will be able to trade excess energy.
Blockchain-based platforms used to track energy stores and to facilitate transactions as its distributed ledger offers a trusted, cost-effective platform where energy-trading peers can connect.
Conjoule – P2P Energy Grid
#SunContract's #P2P energy trading encourages multidirectional trading within a geographical region -allowing more participation from the entire #energy market and providing a lot more economical benefits to both generators and consumers than the conventional system. #Blockchain pic.twitter.com/LR3y45cyw0
— SunContract (@sun_contract) August 29, 2019
Accelerating Adoption of Electric Cars
The car industry has been made significant progress in producing better and more efficient electrical cars. Consumers are paced to adopt electrical cars at an increasing pace. With more people owning electric cars, a suitable system for trading energy between drivers can be developed. This will allow owners to use private charging stations as an asset to be shared.
Blockchain technology can monitor peak energy periods, and prices can be set to be affordable. The system could help charging station owners with transactions, and to make more informed decisions on when and where to charge. They will be able to decide what they can ask for using their charging station.
SolarCoin—A compelling use case for how electric vehicle providers could incentivize adoption
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Reducing and Tracking Carbon Emissions
Although utilities have made significant strides in producing power with renewable resources, carbon emissions remains a significant contributor. CO2, or carbon dioxide, is estimated to be 76% of greenhouse gas emissions. In 2016—it accounted for up to 10.3% of domestic carbon emissions of the total U.S. carbon emissions.
A primary method to reduce the “rate of increase” is to track one’s personal and communal emissions. When individuals track their use, the data can be used to modify behavior. Thus, the ability to tokenize energy credits with blockchain give us an opportunity to issue carbon offset credits. The credits can then be purchased by retail consumers and companies. Or—it can be used punitively to encourage adherence to emissions standards.
Veridium Labs—Tokenizing carbon credits
— JC Rosas (@jcrosas2020) January 21, 2019
Humanity is at a crossroads when it comes to carbon emissions and greenhouse gases and dependency on energy. There is no doubt that fossil fueled energy has made the quality of life better today than at any time in the history of humanity. However—it has come at an environmental cost. Thus the entry of blockchain use case applications to combat carbon emissions is timely. It is truly up to us to protect this third rock from the sun.