There is a new technology being praised in the energy sector as transformational, and that technology is blockchain. The security it provides for transactions has raised the talk of using the technology for transactive energy markets and encourage decentralization.
For instance, it has been suggested that commercial and residential consumers can sideline the hassle of the present-day electric utilities and electricity markets. Instead, they can transact directly with one another or other parties through the digital market.
Not Too Fast: Energy Blockchain Still Not Ready for Transactive Energy Markets
Going by a report published by the Atlantic Council, it states that blockchain is still ill-suited at the moment for hosting the basic features of actual transactive energy markets. That comprises trades settlement, the formation of price, transmission of energy data, etc.
The report sprang from an up-close inspection of the blockchain technology benefits as well as expenses alongside certain power sector requirements in the actual transactive energy market. The report evaluation considers the account of governance standards, improvements in blockchain consensus, existing and potential innovations, on/off-chain scaling, and improvements on privacy.
Although the idea of blockchain technology is appealing for the energy industry just like every other sector. Every sector including the power industry is trying to tap into the potential of the technology. Innovators are seeking to change and reimage the traditional method of doing business. In the present age, we have many power and utility companies. Newly established firms are trying to delve into blockchain projects. They are ranging from monetary payment for grid services to tracking of energy certificates.
Nevertheless, the works remain in the building phases. According to a survey released in July 2019 by Electric Power Research Institute, it shows that the U.S. is still behind their European counterparts. Even the Europeans are not too far off in the exploration of the blockchain-based concepts in the energy sector either. However, federal agencies and policymakers are becoming more aware of the technology.
Blockchain technology at its current technological level offers a little contribution for this field. This is due to the highly intellectual management of the energy and grid needed for the transactive energy market. So, even though the technology provides a lot of substantial benefits, it is not the magical cure-all potion.
It Is Not All Doom and Gloom
The blockchain technology has been found wanting when it comes to the transactive energy market. Nevertheless, there are various suggestions, which are aimed at focusing on and encouraging the growth of transactive energy platforms.
The use of energy blockchain technology is not something to be written off. It should not be seen as either the complete disruptor or solution to all energy-related problems. Even though blockchain has not been proven to be totally suited to actual transactive energy market uses, the technology has displayed better practicality for other uses that demand fewer transactions and public information like asset onboarding.
Therefore, at the moment the blockchain technology is probably going to continue its evolution. It will offer even more valuable tools for certain uses. Eventually establishing and improving upon the older system to improve the energy market functions.