There is a lot of discussion about the detrimental effects of cryptocurrency mining on the environment. Cryptocurrency mining is an energy intensive process, and miners are paid for their energy consumption with a concept called gas fees. Public blockchains like Ethereum and Bitcoin blockchains are built on cryptocurrency mining and a certain gas fee is levied for every transaction. However, what is not widely known and acknowledged is that Blockchain can be a valuable asset to sustainable development, environmental conservation and the development and distribution of clean and renewable power.
As we know, Blockchain provides transparency and security of transactions, unparalleled in other technologies. This makes Blockchain a great asset for the tracking and distribution of renewable power to different end-points.
Centralization of Energy
Currently, power generation and distribution are a highly centralized process. Energy is distributed from one central grid, which is highly inefficient and results in great transmission losses. With Blockchain, energy distribution can be rid of expensive intermediaries and distribution can be decentralized with unprecedented transparency, coordination between end-users and information sharing across the network.
Benefits of Energy Distribution with Blockchain
Electricity companies can use Blockchain to visualize load capacity levels, record the power generated and consumed. On a retail level, retail buildings can better monitor the power consumed by each user, and same goes for apartment buildings and homes. These records cannot be tampered with, thereby enabling better use of energy. Consumers can also visualize what part of their energy comes from renewable sources and fossil fuels, enabling more conscious energy consumption.
Blockchain for a Decarbonized Future
With the move to decarbonization and generation of more renewable power, each house or retail store will receive input from multiple sources, wind generators, solar power, hydroelectric power and many more. These are called Distributed Energy Resources (DERs). With Blockchain, the distributed system can easily be tracked with each node’s input and output monitored, consumption level checked and energy redirected as necessary. This will also work well with IoT and Smart Grids.
Peer-to-Peer Network for Energy
With more electric vehicles hitting the road and a decentralized power distribution system, there is room for development of a peer-to-peer energy sharing network. With electric vehicles especially energy sharing becomes a valuable asset to their functioning. All electric vehicles can be on a common Blockchain and in case of requirement of electricity, they can be connected to the nearest charging station. If unavailable in the vicinity, electric vehicles can look to charging their vehicles from other electric vehicles. This will be possible through Blockchain. All vehicles in the vicinity can choose to offer their electric power and can receive tokens for the same. These tokens can be utilized at charging stations again while they recharge their vehicles. This can be extended to home-generated solar power and other small-scale generation of energy.
India’s Net-Zero by 2070 Initiative
In the COP26 summit at Glasgow, India committed to a five-fold pledge:
- achieving 500GW of non-fossil electricity capacity
- generating half of all energy requirements from renewables
- reducing emissions by 1 billion tonnes from now to 2030
- reducing the emissions intensity of GDP by 45%.
- achieving net zero emissions by 2070.
Blockchain is the answer for the achievement of these goals. With peer-to-peer energy trading and DERs, Blockchain can help in the redistribution and efficient use of all power generated. Tata has implemented a Blockchain-based energy trading project recently and as part of the project, over 150 sites will be able to sell excess power to nearby residential areas and commercial sites with the platform. Settlements will be real-time and energy transfer will be transparent and efficient.
Ownership of these renewable energy sources can also be recorded on blockchain. Consumers can be given certain carbon credits to encourage the use of renewable energy sources, thus instilling a sense of climate consciousness and raise awareness about global warming. Blockchain can also help the government track other environmental conservation programs like reforestation and record goals to track their progress on their commitment to the Sustainable Development Goals.
Blockchain is a valuable asset in the transformation of the world into a climate conscious place. With transparency, traceability and efficiency, Blockchain can work as the backbone of the evolution of a self-sustaining, renewable and sustainable world. Blockchain, with IoT, AI and other new-age technologies can work in tandem to ease us into a new and metamorphosized world.