Solarplaza illuminates the future of blockchain green energy

Rage Comment : In order to make full use of surplus electricity and skip the high intermediary costs of intermediaries, Solarplaza hopes to use blockchain technology to remove middlemen in the energy industry and strengthen control over the network, which can not only make full use of resources, but also directly implement the cost savings to consumers. Africa's demand for electricity is huge, corruption is prevalent, resulting in a lack of industry-wide regulatory structure. Blockchain can automate a fair regulatory framework, institutionalize mechanisms, and solve the problem of lack of funds for infrastructure projects, which is very suitable for the needs of the African energy industry.

Translation: Nicole

Over the past year, hype surrounding blockchain in the energy sector has been in full swing, yet “hard” data and project details have been hard to come by.

To elaborate on current and promising use cases, a group of young energy industry professionals from the Netherlands organized a webinar on December 14 on the topic of “Blockchain’s Impact on Solar Energy.” Speakers included Axel von Perfall, senior manager at PwC Energy and Utilities; Abraham Kessler, CEO of Sun Exchange, and Scott Kessler of LO3 Energy.

Jordan Kouzmanoff of Solarplaza wrote in a January 19 news article:

“The main practical significance of blockchain technology is to remove intermediaries and their control over the network.”

Disintermediation: Removing the middleman

Kouzmanoff cited the potential for energy consumers and “prosumers” to use blockchain to remove middlemen from the electrical energy value chain as the biggest reason why utilities and industry regulators consider blockchain platforms to be a significant threat to them, even though it is still early days for the technology.

“If blockchain technology becomes dominant across the energy sector, you should expect to see utility and government involvement become obsolete, and in fact, blockchain could potentially take away much of the power from regulators.”

This was one of the many reasons webinar participants identified Africa as a region ripe for blockchain energy applications to reach their full potential, with Solarplaza highlighting:

“There are still 650 million people in Africa who don’t have any access to electricity, and the big question is where are they going to get the energy from. The simplest answer is solar energy, which creates a huge opportunity for blockchain technology.”

Blockchain and solar microgrids in Africa

According to Solarplaza webinar participants, Africa’s huge demand for electricity, sustainable development initiatives, lack of established industry-wide regulatory structures and widespread corruption make the African energy sector fertile ground for blockchain.

Kouzmanoff noted, however, that there are still regulatory and financial hurdles that need to be cleared for this to happen: For example, most regulatory structures do not allow utility consumers to sell surplus energy generated from solar, wind or other on-site or shared community renewable energy generation.

Webinar participants believed that blockchain can automate and institutionalize fair regulatory structures and address the lack of funding for infrastructure projects.

Kouzmanoff wrote:

“There are a large number of investors ready to put capital into the renewable energy sector, but they lack the infrastructure to do so; blockchain technology provides a clear solution for this by building in trust.”

He also said that innovative solar startups and projects have gained the trust and legitimacy of the international development and private sector investment community, a trend that Microgrid Media has been following closely.

Distributed Energy Wave

Coincidentally, innovative distributed solar microgrid startups, such as LO3 Energy, have attracted interest and support from venture capital and private equity investors, power/energy and other multinational corporations.

Kouzmanoff wrote:

“The only viable alternative for homeowners who want to buy renewable energy today is to buy it from the energy market, but the reality is that such deals essentially finance remote power plants whose energy may never reach consumers.”

“So while money does go into renewable energy, homeowners in the local community are not benefiting from it, as opposed to blockchain microgrids, which would ensure that renewable energy is sourced locally.”

He continued, blockchain microgrids also address regulatory barriers “by essentially removing the barriers that prevent community members from selling surplus energy to each other.” Such microgrids are not just a theoretical concept, but a real-world example that has been successfully implemented in dozens of communities around the world, including Brooklyn.

Kouzmanoff also summarized the main conclusions of the Solarplaza blockchain in the energy sector webinar:

Blockchain technology, best known for its use in the cryptocurrency Bitcoin, will have a huge impact on the solar industry;

Although currently only implemented in small-scale microgrids, if blockchain technology is implemented on a large scale, it will make utility and government involvement obsolete, thereby directly transferring the cost savings to consumers;

Surprisingly, blockchain technology may take root first in Africa, where high demand, low supply and corruption have hindered the establishment of a regulatory framework.