It’s been more than 150 years since the first modern solar power plant was established in Algiers, but we still haven’t effectively harnessed the sun’s energy. Fundamental changes in the energy sector take time.
Multiple experts suggest most applications of blockchain technology for energy are in the testing stage. But with over 150 startups focusing their time, effort, and money on innovation in this space, results are surely inevitable. Companies want to use the blockchain to automate their way to efficiency. They’re supporting the development of platforms to streamline energy management and establish peer-to-peer energy trading platforms.
Venture capital continues to drive much of the innovation in the energy sector. Where funds exist, innovation will almost always follow. It’s a matter of time until blockchain-powered platforms change the way we think about energy.
1. Peter Bronski, Director of Marketing & Communications of The Energy Web Foundation
“Blockchain is still a nascent technology and industry within the energy sector, but it is maturing rapidly. We have seen rapid growth in the number of major incumbents making blockchain-related investments and taking a serious look at the technology, including utilities, grid operators, energy companies, renewables companies, corporate customers, and software developers. We're seeing multiple players partner on first deployments, such as the recent announcement involving Spanish utility Iberdrola, software startup FlexiDAO, and Energy Web Foundation on a project to track green attributes. In short, blockchain today is like smartphones in the mid-2000s, just before Apple introduced the world to its iPhone: tremendous promise, but we're only just beginning to see all the ways this new technology may unlock value, business models, etc.”
2. Assaf Ben-Or, CEO and Founder of Greeneum
“Today we see a lot of movement in the energy sector regarding blockchain both from new companies and organizations and traditional utilities. There are many ambitions to unpin the energy market as we know it.
As a secure, transparent and decentralized infrastructure, the blockchain technology has the potential to completely redefine and transform the way we produce, buy and consume energy. The energy market is highly regulated, still very centralised and relies on a regulative structure which has not changed for decades. The process to surpass legislations and monopolies, especially in big centres is relatively slow. What we see now is a growing number of startups and SMEs proposing and developing innovative solutions using the technology, but there are still technological, cultural and legal processes to be completed before we could see it replacing the traditional structures.”
3. Dr. Mervyn Maistry, CEO and Founder of Konfidio
“The sector is characterized by experimentation. Production-ready solutions are almost non-existent, and innovation is being driven by VCs. The technology is perfect for decentralizing the management and remuneration of energy production. All industry actors, including Transmission System Operators (TSO), Distribution System Operators (DSO), and retailers are aware of this potential. The distribution side of the industry is actively working with startups to develop proofs of concept (PoCs) that may lead to production of blockchain-based energy applications. TSOs are positive about blockchain and are ready to facilitate its large-scale adoption once there are working and viable solutions on the distribution side.”
4. François Le Scornet, President of Carbonexit Consulting
“There are over 150 startups working in the energy+blockchain sector on many different use cases. A lot of those startups are actually located in Europe, in particular in Germany, the Netherland, Switzerland and in the US. There are also some notable initiatives in Asia, South Africa and Australia but to a much lesser extent. Large utilities like Innogy, Tepco, EDF and smaller players like Wien energy are entering into the game by supporting those startups and by testing some use cases locally. Most use cases are linked to peer-to-peer energy trading, smart purchase platforms, certificate of origin, electric mobility (charging/sharing) and less industry-specific activities like M2M communications, IoT, and supply chain tracking.”
5. Vincent Manier, CFO of ENGIE Insight
“While the energy industry will undoubtedly benefit from an energy sector blockchain, we can not overlook how this technology drives energy efficiency and sustainability across industries. From tracking carbon emissions, to creating supply chain visibility and engaging consumers, blockchain can enable a near real-time version of truth for transaction records and issue a new era of green finance, while reducing GHG emissions for energy companies and beyond.”
6. Josef Kulovany, CEO and Founder of WECHARG
“Blockchain in energy is in its infancy. Injecting the most fundamental unit of value, energy, into the blockchain will prove lucrative to the early investor.”
7. Le-el D. Sinai, Associate, Reed Smith
“We are seeing both startups and industry incumbents explore upstream, midstream, and downstream blockchain solutions. A well-known example is Brooklyn’s solar microgrid, in which local residents are able to trade excess energy on a decentralized market autonomously. [The grid is] managed by a private blockchain, appears— on its face —to save time and cost, raise energy capacity, and even lower emissions.”
8. R. Whitney Johnson, Partner and Chair, Technology and Intellectual Property Group, Stoel Rives LLP
“Blockchain technology is still very much in its infancy. The current state of blockchain in the energy industry is comparable to the state of the internet in the mid-1980’s — still in incubation. But innovators are developing products and protocols that will enable the technology to integrate with daily commerce in the near future. It took the Internet twenty years or more to mature from a small research network into a ubiquitous and life-altering technology. The proliferation of blockchain technology is disrupting the energy industry now and increasingly over the next several years.”
9. Buck B. Endemann, Partner, K&L Gates
“The state of blockchain in energy today reflects, to some extent, the continued slowdown in cryptocurrency mania that began in early 2018. Early energy blockchain companies that promised industry-shaking results and the development of entirely new business models often lacked a clear understanding of energy markets, project development, existing regulatory regimes, and the role of incumbent utilities. As a result, many early proof-of-concepts have failed to scale. Today, energy blockchain applications moving into the pilot phase and beyond are largely based on specific ideas on how to operate more efficiently in existing markets and under existing regulations. There is a greater focus on providing consumer value, rather than consumer freedom.”
10. Michael Yuan, Co-founder and Chief Scientist of The CyberMiles Foundation
“Nascent. There are a handful of ambitious projects (ex. Eloncity) aiming to decentralize the electrical grid infrastructure and energy monopolies, replacing them with a hierarchy of blockchain-enabled microgrids. Such microgrids will allow communities to store, trade, and consume locally-generated renewable energy.”