Blockchain is a series of verified transactions that are cryptographically linked and secured. Many people are most familiar with blockchain due to its association with Bitcoin and other cryptocurrencies.
However, people are interested in seeing how it could play a crucial role in various industries — including the energy sector.
Many people who invest in cryptocurrencies know about initial coin offerings, or ICOs.
They involve giving investors a new type of cryptocurrency or token in exchange for an existing type of cryptocurrency.
The ReNu Pre-ICO is such an arrangement that aims to raise an initial $5 million in funding to recruit the world’s top scientists and figure out some of the most pressing challenges related to energy.
The central belief of this project is that the world already has existing technology that could provide renewable energy to everyone.
However, there needs to be an incentive to encourage people to use renewables and make their own. The people behind the project think blockchain is the answer.
One goal of the initiative is to build a contract platform that lets people buy, trade and sell energy. It would permit anyone to convert renewable energy into decentralized ReNu Coins, then trade them with another person to get cryptocurrency.
Wien Energie, the biggest energy provider in Austria, is extremely interested in blockchain and wants to test it to prepare for potential real-life use cases in its business. The company has performed tests with blockchain in the past for gas trade transactions.
More recently, the business turned its attention to ways to use blockchain for other energy needs. Based in Vienna, the company already serves 2 million retail and 235,000 commercial customers.
If it can determine feasible ways to incorporate blockchain into its business structures, those efforts could be the start of a major change in Austria and beyond.
Throughout generations, engineers have implemented a wide variety of ways to reduce energy consumption through natural resources. For example, in Bahrain, wind turbines partially power the country’s World Trade Center, supplying enough energy to give 300 normal-sized homes power for a year.
One of the prevalent criticisms associated with cryptocurrencies is the amount of energy needed to mine them.
Mining involves using substantial computer setups and software to solve mathematical equations to verify transactions on the blockchain. As miners carry out that task, they create more cryptocurrencies. However, statistics show the energy expenditure associated with mining is as much as the total usage of entire countries.
To make the consumption problem less severe, some companies use wind power and other renewable resources to mine Bitcoin.
One of them is HARVEST, which primarily relies on wind to reduce the mining impact of a cryptocurrency called Zcash, plus donates all profits to organizations involved in climate change research.
Many utility companies had to upgrade their payment options when customers showed a preference for paying with credit cards over the phone or inputting data into online forms instead of mailing in checks.
Now, some early-adopter utility companies permit customers to pay bills using cryptocurrencies rather than physical money.
One of them is Remixpoint, a Japanese provider. Customers reportedly even get discounts for choosing to take care of bills with that method.
Similarly, a company in Germany called Enercity allows paying for electricity, gas, heating and water bills with cryptocurrencies.
Among the advantages of these arrangements is they do not require people to have bank accounts. Individuals only need internet access and digital wallets for storing their cryptocurrencies.
This overview of how cryptocurrencies are disrupting the energy market gives a fascinating look at how the industry might change in the near future and is already evolving.
The centralized nature of most current energy companies is in stark contrast to the decentralized structure of cryptocurrencies and blockchain, which could set the stage for significant alterations in how people consume energy and pay for that privilege.
Image by Andre Francois
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