Many would consider 2017 to be the year of cryptocurrency. Coins like Bitcoin, Litecoin, Ripple and dozens of others have shot up 1,000%+ and do not seem to be slowing down.
What really happened in 2017 was the year of the blockchain. Blockchain is the technology that all of these cryptocurrencies are built on top of. Blockchain technology can be applied to almost every sector, including solar! Before we go into how they can be used together, let us go over a high-level definition of what blockchain is.
What is Blockchain Technology?
On a basic level, blockchain technology is a secure and distributed database, also called a ledger. On a practical level, blockchain technology allows currency to be sent all across the world without needing the validation of a bank. This is simply because of the network’s distributed nature. The blockchain is also not just for coins, and can include games, such as Cryptokitties, among others. To get a deeper dive on what blockchain is, feel free to read about it here or here.
Now, you may be wondering what in the world can a distributed ledger do for the solar industry? As it turns out, it can do quite a lot.
The Conventional Energy Problem
Right now, most of the world's energy is predominantly powered by large generation plants. Unfortunately, the world relies on these plants and the grid that they are connected to, to distribute power to all of its consumers. While the model has sufficed in the past, as more and more people go solar and produce their own energy, this one-directional structure begins to fail, requiring a more flexible solution.
In the past, hotels used to be the only place where people stayed when traveling, and taxis were the only option when people wanted to get around town without their own car. Then Airbnb and Uber came in and created a distributed network that changed everything. Right now, the power plant controllers are in the same position as the hotels or taxi companies were, and the blockchain is the technology that can change the way things work.
Solar Energy Exchanges
There are a slew of companies that are looking to create exchanges for people to buy solar panels or clean energy and sell it around the world. This model uses multiple sources to produce power. In other words, instead of having one plant powering a whole neighborhood, a few houses in that neighborhood with solar roofs can share their energy with other houses in the neighborhood, AND get paid for it. This is what the blockchain can enable homeowners to do.
How is this possible?
The only reason that our energy systems have gone through power plants up until this point is because there was no other option. They are also a generally trusted source, whereas before blockchain was invented, there was no mechanism that allowed for diverse, distributed sources to provide power. With blockchain, people can send energy to other households, track that on a public ledger, which can also be validated by other nodes to make sure that there is no corruption in the network.
Transparent And Secure
The most useful aspect of blockchain is that it is 100% transparent to anyone who views the ledger, and it is immutable, meaning once a transaction or event occurs, it becomes very challenging for anyone to change the record of that event. The ability to prevent duplication is one reason why the blockchain is so lucrative.
When energy is passed from one household to another, everyone on that network will be able to see that, and how much they should be compensated for that as well. Pretty cool!
Companies On The Move
Right now, there is a rush to build out the ideal energy grid. From that, money is flying everywhere to fund companies that want to to take on this challenge. The Sun Exchange is one of the frontrunners, and they label themselves as “The Solar Panel Sharing Economy”. Another juggernaut that is working on applying this model in Australia is PowerLedger, who recently raised a massive $27 million USD Initial Coin Offering (ICO) to start production.
What Is In Store For The Future?
Blockchain technology will likely disrupt every industry at some point in time. As for solar, the application and benefits to putting solar energy on a peer-to-peer grid are more apparent than ever. The great thing is that while dozens of companies compete to win over this market, the everyday consumers will be the ones who benefit for years to come.