Emerging blockchain technology to impact utility performance
SANTA CLARA, California, Feb. 13, 2018 /PRNewswire
Frost & Sullivan's recent analysis, Digital Grid -- Capitalizing on Opportunities with Blockchain Technology, finds that the introduction of blockchain technology could transform current utilities and consumer business transaction models by enabling a decentralized energy production model. This potential disruption is forecast to make the grid more reliable and efficient, reduce utilities' capital expenditure on renewable energy generation, and allow consumers to participate in peer-to-peer (P2P) trading.
"Most energy cryptocurrency and blockchain platforms-as-a-service companies are operating at a pilot scale, with limited revenue growth. However, with Mega Trends such as 5G, transactive energy, and micro-grids set to become prominent over the next five to 10 years, adoption and revenue could see explosive upsurges," said Frost & Sullivan Energy & Environment Senior Research Analyst Naren Pasupalati.
Pasupalati recommends that blockchain developers tap into areas that have adopted advanced metering infrastructure (AMI), such as Washington D.C., Maine, and Nevada, and high distributed solar PV installation, such as California and Georgia. These areas have an increased probability of adopting blockchain technology for P2P energy transactions.
Five application opportunities identified for blockchain in the digital grid sector include:
- Billing platform for retail sales and net metering: Blockchain's functioning as a distributed record of transaction data can be used to create a comprehensive archive of all electricity billing data for utilities;
- Platform for P2P trading and renewable energy certification: Blockchain platforms enable utilities to empower consumers to simply trade electricity with each other and settle payments with the help of an automated and decentralized system;
- International energy trading: The volumes of international electricity trade, both export and import, are forecast to grow over the next 10 years to almost 83,000 TWh;
- Electric vehicles and vehicles-to-grid: Vehicle-to-Grid is an upcoming initiative defined by the bi-directional electricity flow between the vehicle and electrical grid;
- Customer management: Blockchain technology could disrupt the way customer accounts are managed digitally by utilities.
"With blockchain, the lines between consumers and utilities will be blurred; however, many states in the US still prohibit direct sales of electricity by non-utility entities to consumers," observes Pasupalati. "Regulations will need to evolve as utilities lean toward decentralized energy systems."
Source: Frost & Sullivan
Illustration Photo: Technology demonstration the Siemens-OMNETRIC project, which incorporates grid edge control communications using Siemens' Microgrid Management System and an Open-Field Message Bus (OpenFMB) framework (credits: Josh Bauer / NREL / Flickr Creative Commons Attribution-NonCommercial-NoDerivs 2.0 Generic (CC BY-NC-ND 2.0))