The innovation at the heart of bitcoin long ago leaped from the world of cryptocurrency to that of finance and many other businesses that need a distributed ledger system. Now we learn that German engineering giant Siemens (FWB: SIE) and the New York startup LO3 Energy are collaborating to jointly develop microgrids that enable local energy trading based on blockchain technology.
“The constant evolution at the grid edge requires advanced control, automation and data analytics technologies enabling secure, stable and reliable integration of decentralized energy systems as well as supporting the establishment of new business models. We’re convinced that our microgrid control and automation solutions, in combination with the blockchain technology of our partner LO3 Energy, will provide additional value for our customers whether on the utilities side or on the prosumer side,” said Ralf Christian, CEO of Siemens’ Energy Management Division.
Lawrence Orsini, founder of LO3 Energy, added: “In the world of finance, blockchain technology is rapidly advancing across many sectors, but in the energy market, things are comparatively different. With our microgrid solution in Brooklyn, we’ll demonstrate just the beginning of what blockchain can do in the transactive energy world.”
What Does 2021 Hold for the Markets? HYCM CEO SpeaksGo to article >>
The microgrid planned for Brooklyn, which started as a pilot project of LO3 Energy, is now being further developed with the aid of Siemens Digital Grid in the US. The developers explain that for the first time, a microgrid control solution from Siemens is being combined with the peer-to-peer trading platform from LO3 Energy known as TransActive Grid. This solution is meant to enable blockchain-based local energy trading between producers and consumers in three of Brooklyn’s neighborhoods as well as balance out local production and consumption.
For example, the combination of a microgrid control solution and blockchain technology will make it possible for a provider of photovoltaic systems on the roofs of buildings in Brooklyn to feed its excess electricity back into the existing local grid and receive payments from the purchasers.
Preliminary tests of peer-to-peer transactions between neighbors were successfully completed in April 2016. “Just as our partner LO3 Energy we are envisioning tremendous opportunities for the application of the blockchain technology, especially in microgrids with distributed and decentralized energy systems. Its big benefit is, that it permits transparent, efficient trading between multiple participating systems and various stakeholders while taking grid-specific requirements into account,” said Thomas Zimmermann, CEO of Siemens’ Digital Grid Business Unit.