The power and utility sector has yet to fully embrace the blockchain technology. How can energy providers and consumers alike benefit from the technology?
It’s always interesting to follow the rise of new technologies, especially when they have the potential to reshape our future. What has received much attention recently is blockchain.
The technology promises to speed up transactions as well as cut costs. It is already widely used in the financial services sector, and a growing number of industries are experimenting with the technology. The blockchain technology can be applied to and can disrupt different industries around the world, including the energy sector.
It was Bitcoin that introduced the blockchain concept—and its ability to revolutionize the payment system—to the world in 2009. The fundamental basis of the technology is to disrupt the traditional business process by providing an applicable and decentralized option to the mainstream system, which is centralized.
Some start-ups have already invested massively in incorporating the blockchain technology into the energy market. Despite the differing approaches, the goal seems to be the same: creating a functioning global energy sharing ecosystem that balances demand and supply globally.
Once taken into use, it will be possible to consider electricity as an asset that can be traded or held depending on the consumer’s preferences. Examples of how blockchain technology can disrupt the energy market include but are not limited to 1) variable electricity rates, 2) use of cryptocurrency in energy payments, and 3) peer-to-peer energy trading platforms.
There are numerous cases for the use of the blockchain technology in the energy market. While there already exists lots of potential benefits in tokenizing the energy market, there is still a lot of work to be done before a successful large-scale implementation of a blockchain energy ecosystem can be reached. The technology can only be applied successfully to the energy market after certain issues have been addressed, such as scalability of an extensive blockchain network. The sings and prospects of blockchains disrupting the energy sector do look encouraging.
Cornfield & Partners can help you with market opportunities related to blockchain and the energy sector. To find out more about potential business opportunities, contact firstname.lastname@example.org or you can call us on +44 (0) 20 7692 0873