Direct Energy Business has partnered with LO3 Energy to launch a cost-effective blockchain-based metering platform that could allow commercial businesses to hedge critical power needs and cut costs on electricity.
The platform, called “Micro-Energy Hedging” will be based on the LO3 Exergy blockchain—and it’s designed to benefit commercial and industrial companies in Texas by allowing them to automatically place orders for customized energy hedges in increments as small as hourly.
Compared to the currently available energy products that usually come in daily, weekly and monthly packages, this micropower platform is more fine-tuned and cost-effective.
Direct Energy Business is offering its commercial customers energy hedges so that they can get access to critical, must-run power loads instantly in a competitive market.
Explaining the decision, president of Centrica North America and Direct Energy Business, said:
“Direct Energy Business is focused on helping businesses lower their energy expenses with innovative products and services that allow them to manage price risk or reduce usage altogether”.
“By working with companies like LO3 Energy, we can leverage new technologies that bring the future of energy to our customers. The Exergy platform will further integrate customers and suppliers and provide additional choice for their energy needs”, he added.
The U.S energy retailer is currently seeking the participation of Texas customers to help it roll out the first phase of the projects, which is planned to commence later this year.
On his part, LO3 Energy Chief Executive Lawrence Orsini explained that businesses have historically managed risks by signing fixed-price contracts or long-term power purchase agreements with their energy providers.
“But energy should be treated like any other asset or cost that needs to be managed and the ability to time market purchases and select from a mix of resources can yield large savings versus ‘set it and forget’ approaches”, he noted.
He went further to point out that the project “will put businesses in Texas on the map as the innovators who led that change”.
The Exergy platform is an innovative business-to-business network powered by blockchain that facilitates the transaction of energy. The platform utilizes “permission tokens” to secure data and control who sees the data based on the owner’s permissions. Direct Energy Business customers will need to use LO3 Energy proprietary smart meters to access the blockchain platform.
Customers will use Exergy platform to generate, store and share their energy usage data securely and automatically predict their hour-by-hour power needs that meets their requirements far more cost-effectively.
It’s worth noting that in late 2017, Centrica Innovations, the $140m venture fund of Centrica (that also owns Direct Energy), was one of the companies that invested in LO3 Energy’s Series A round of funding.