Blockchain and the built environment: how far are they connected?
How Blockchain helps with efficient use of electricity
Answer: could be closely.
Efficient use of energies especially electricity is a major concern for building’s life cycle costing, in particular in this era when everyone is talking about saving the earth’s resources for a sustainable growth of economy and for our next generations.
From the economists’ point of view, the most efficient way to achieve optimum use of energies is through trading in free markets. The question is: how can this happen?
What is Blockchain?
Blockchain is commonly linked to cryptocurrencies. It is a network of individual computers or digital ledgers, that enable each transaction using cryptocurrencies, e.g. Bitcoins, to be checked. Inside the network, the computers that record transactions are operated separately and independently, hence ensuring accuracy and no forgery in transactions or anomaly occurred.
Blockchain provides the medium through which individual energy users can interact with one another and trade to pursue their respective best interests. The Blockchain network creates a free market for the participants to exercise the greatest freedom to determine the right prices for goods and services, and thus proceed with buy-and-sell. Such medium is conventionally involved a lot of middlemen who track each transaction. These middlemen now become the computers who are considered more efficient and reliable than human beings.
TEPCO to decentralize electricity distribution
Electricity is traditionally dispatched to consumers through a central grid system. Tokyo Electric Power Company (TEPCO) however has been making itself to be the pioneer of applying the Blockchain technologies to decentralize the distribution of electricity. By investing in Electron, a UK energy technology company that harnesses the Blockchain technologies to establish more efficient, flexible, and reliable systems for the energy sector, TEPCO is exploring the potential to change the existing centralised structures to decentralised systems in energy transactions by using Blockchain.
Picture (above): Tokyo Electric Power Company (TEPCO).
Picture (above): Electron, a UK energy technology company that harnesses the Blockchain technologies to establish more efficient, flexible, and reliable systems for the energy sector.
Paul ELLIS, CEO of Electron, foresaw that the vast physical grids that form nowadays utilities system would eventually be replaced by a more robust shared infrastructure. The new infrastructure can identify and record the properties of these assets, enabling peer-to-peer trading of electricity and carbon credits, for example, similar to trading cryptocurrencies.
This prediction is partly supported by the drastic increase of household energies in the wake of the technology boom in the last few decades.
Some hesitations ….
Looking forward, the way to go may not be as promising as the advocates projected. First the Blockchain is still an immature technology, at least for the time being. Second the virtual network of Blockchain is not intended to completely get rid of the physical presence of grids and poles of electricity distribution. Third, intriguingly, Blockchain itself is energy-consuming, contrary to the ultimate aim of using Blockchain to promote energy-saving.