Blockchain to increase efficiency and transparency in the energy sector
Blockchain is helping to shift transactions and data management towards a decentralised ledger system to improve efficiency and transparency. The blockchain technology is expected to support the energy sector in the wake of revolutionising change from conventional energy towards renewable sources.
According to the Governor of the Bank of Thailand, Veerathai Santiprabhob, the use of technologies like blockchain “can help safeguard financial information and reduce the number and magnitude of fraudulent activities.” Therefore, blockchain is enticing corporations to use the technology for better auditing procedure in their businesses, particularly in a commodity-based business such as energy.
In the coming years the cryptocurrency and its IT infrastructure, which use a huge amount of energy, would itself impact the energy market to some extent. The computer algorithm behind cryptocurrencies such as bitcoin and ether will use a significant amount of electricity. Currently, these infrastructures are operating in countries where electricity prices are lower, though the use of electricity in these areas will put pressure on the demand side, this will increase power prices. It is estimated that the use of electricity by cryptocurrency in 2017 was more than the power used in Denmark.
Blockchain can also help to promote solar rooftops, electric vehicles, and other energy applications due to its distributed ledger technology and low transaction costs. In addition, electric vehicles require power to charge, where these charging infrastructures can be run efficiently by using blockchain technology.
Meanwhile, CyClean is one such project which encourages people to rent electrical vehicles. CyClean coins can be mined just by using CyClean products based on meters or watts. This can help to manage better inventory and financial records of energy use as well promote bitcoin industry.
Many large utilities and commodity traders are also working on blockchain technology in the energy sector. Energy Web Foundation, the Enerchain Project and Bonkymoon project in South Africa are a few examples using blockchain technology. In the Bonkymoon case, donations for school are collected in the form of power units which are then supplied to schools from local microgrid stations. So, there are not only less chance of misuse of donations, but the electricity supply is also managed in a better way with relatively less administrative cost.
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