200 applications of blockchain in the energy system

Resource / 200 applications of blockchain in the energy system

By Gemma Adams / 15 May 2017

This report by the European School of Management and Technology (ESMT Berlin) shares the results of a survey of German energy executives and the Deutsche Energie-Agentur GmbH (dena) – the German Energy Agency - to gather opinions, current and planned actions, and visions of the future role of blockchain applications in the energy sector.

Blockchain is a decentralised internet protocol that enables transactions between peers without an intermediate institution such as a bank. Cryptocurrencies like Bitcoin operate using blockchain, but its applications can be also non-monetary, for example, smart contracts that are automatically executed once specific conditions are fulfilled.

Blockchains operate as distributed databases that contain a continuously growing list of data records: the so-called blocks. These blocks are time-stamped, shared, unalterable, and connected to preceding blocks; they contain data and programs, batches of individual transactions, and executables. Transactions are verified by computers run by the network’s users in short intervals: the so-called nodes. 

So what are the benefits?

Security: Blocks are distributed, public, and encrypted so if a hacker wanted to modify a contract, the whole blockchain would have to be reconfigured at every node – a computationally and organisationally difficult task.

Process optimisation: Around half the opportunities identified for using Blockchain through the survey relate to billing, sales and marketing, automation, metering and data transfer, mobility, communication, and grid management.

Platforms and markets: The other half relate to peer-to-peer trade, public trading platforms (such as balancing markets, capacity markets, and intraday trading), private platforms (such as demand-side management, the coordination of the existing power plant portfolio, industrial energy supply, and virtual power plants) and decentralised generation (such as decentralised energy management, neighbourhood solutions and renewable installations).

What might the implications of this be? What related resources have you seen?

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