'Standing in the air, the pigs can fly', Lei Jun once said this sentence swept the Internet, so that many entrepreneurs were guilty, running on the road to find 'tuyere'. In the second half of 2017, 'blockchain' concept suddenly In the north and south of the river, it became the object of capital chasing. “Blockchain application” has become the most popular vocabulary nowadays.
With the rapid development of renewable energy in the world, distributed energy has become the best way for the development of the present and future trends. Rifkin said in the “Third Industrial Revolution” that everyone in the future is both an energy consumer and a producer. The energy can be connected and exchanged with each other.
The emergence of blockchain technology makes it possible for distributed energy to realize mutual sales within the microgrid. LO3 Energy, founded in January 2012, is an outstanding representative of the application of blockchain technology in the energy sector. It uses blockchains. Technology enables efficient trading of green energy between neighbours.
What is Blockchain Technology?
When it comes to blockchains, one must mention the extremely hot Bitcoin in recent years. Bitcoin has realized the decentralization of electronic money, anonymization, and freed it from the constraints of third-party institutions. This feature is the inventor of Bitcoin. Cong calls it 'blockchain'.
In layman's terms, a blockchain consists of a chained data structure in which data blocks are combined in a sequential manner in chronological order, cryptographically guaranteed to be irrevocable, unforgeable, and thus formed distributed databases or distributions. Book.
The emergence of blockchain technology is of extraordinary significance. It is a revolutionary revolution for existing trading methods. First, decentralization. The blockchain consists of many nodes forming an end-to-end network. There is no centralization. The equipment and management agencies, any one node will not affect the operation of the system as a whole. In the existing payment system, all payments must be completed by the central agency, this center may be a bank, Alipay or WeChat. In the context of blockchain technology, both parties of the transaction only need to write transaction information in the block, then broadcast the entire network, and eventually write a public public ledger, which cannot be changed. Second, to trust. All nodes in the system The digital signature technology is used to verify, without trust can also be traded, as long as the system according to established rules, nodes can not and cannot deceive other nodes. Third, collective maintenance. The system is maintained by all nodes with maintenance function , everyone in the system participates in maintenance work. Fourth, reliable database. Every node in the system has the latest complete number. Library copy, single or even multiple node modifications to the database can not affect the other node database, unless it can control more than 51% of the nodes in the entire network to modify at the same time, and this is almost impossible to happen. Every transaction in the blockchain passes The cryptographic method is concatenated with two adjacent blocks, so it can be traced back to the past and present of any transaction.
To take a popular example, there are five people in a small circle, namely A, B, C, D and E. One day, A transfers to B 100 yuan, A just broadcast in this small circle: Transfer to B one hundred yuan, please write down this information in their respective books. ' So, each of these five individuals becomes a node. Each transaction will be in the node in the order in which the transactions take place. Record separately. If one day B says that A has not transferred him 100 yuan, then everyone in this small circle can refute B. In this small circle, there is neither a trading center agency nor mutual trust between the parties. Need to be recorded on a public account and collectively maintained.
Such a trading method is very suitable for the free trade of energy within the distributed energy system. Further development of the microgrid is in need of such an efficient energy trading method that everyone can participate in. As the so-called 'time heroes', LO3 Energy is in a new situation. It came into being.
Blockchain Technology Application: TransActive Grid Project
As a New York-based startup, LO3 Energy is committed to the free trade between power users within the microgrid. In its headquarters in Brooklyn, New York, it has developed a project together with the decentralized application startup ConsenSys. --TransActive Grid aims to combine blockchain technology with the energy industry and use a new payment method in a microgrid to enable neighbors to write smart contracts on the blockchain to select the energy sources they need. , and even decided to sell energy to whom.
Lawrence Orsini, CEO and founder of LO3, said that this cooperation will be one of the most disruptive technology applications in the electricity market. He believes: 'We are focusing on the multi-functional power grid in the future and the current grid will be There is a big difference. If things go well, consumers will not only be consumers, but a consumer.'
As a new type of electricity retail supply platform system, TransActive Grid uses Ethereum blockchain technology to enable users to directly skip retailers and trade directly in the power trading wholesale market. Users can purchase electricity at a price close to the wholesale price. Acting for price fluctuations, users can make real-time energy purchases and purchases, and make sensible power consumption decisions to save costs. This project can span the traditional electricity market, inspire users to purchase solar power generation panels and energy storage batteries, and promote power generation from the traditional single upstream. Power generation transforms into distributed generation, driving a cleaner and more efficient energy future.
Compared to the traditional electricity market, TransActive Grid has many advantages. First, automated billing and billing reduces the amount of electricity users. In this system, all payments are automatically recorded and then from a smart contract (or payment channel) Transfer to another smart contract, this process can skip traditional payment service providers, greatly reducing transaction costs. Second, eliminate bad debts. TransActive Grid stores digital currency pairs through smart agents compared to the risk of bad debts of traditional retailers. The electricity used by it is paid in real time. In addition to recharging smart agents, the system also requires the user to pay a certain amount of deposit. If the smart agent fails to pay the electricity bill in time, the corresponding balance of the deposit is deducted. Third, a higher market Efficiency. The biggest advantage of TransActive Grid is that it can apply smart meter reading technology to all nodes of the grid, including users, to obtain real-time dynamic power distribution data, thereby maximizing the efficiency of market operations.
Based on this technical setup, LO3 Energy conducted an experiment in the Brooklyn area where its headquarters is located. The two neighbors realized power sales across the wall, and one resident sold excess energy generated by its solar panels to his neighbors. In each of the units, the electricity produced by the residents is calculated and recorded on the Ethereum blockchain. By using programmable smart contracts, these electric powers can be bought and sold in the open market. For self-use, surplus electricity is sold in addition to Outside the power company, the partition wall can also receive a premium on electricity prices, while the power purchaser does not need to pay more. This allows both parties to participate in the exchange.
As global energy develops in a distributed direction, the global energy industry has created a wave of decentralization. In the wake of the wave of wave of 'blockchain' boom, the emerging startup LO3 Energy seems to be in tune with Getting closer and closer.
Overturning tradition, success in sight
Energy development is not based on the will of the people. Once upon a time, fossil energy became synonymous with energy. With the world's attention to climate change and technological advancement, renewable energy is gradually becoming the direction and future trend of energy development. However, the production and consumption of energy has slowly shifted from centralized to distributed. The third industrial revolution predicted by Rifkin has quietly occurred on our side.
LO3 Energy's blockchain technology is in line with this trend. From a philosophical point of view, it represents a kind of advanced productivity, a booming emerging force, which has had an impact or even subversion on the old tradition, and bears the brunt of it. It is a utility company.
As we all know, traditional power production is faced with many problems. According to a Goldman Sachs data, the United States has a high rate of power loss due to voltage changes in its power grid lines. It is estimated that about 8% to 9% of the power fails to reach end consumers. , This has caused the potential loss of U.S. power grid companies to amount to billions of U.S. dollars, and the reliability is worrying. According to a report from the U.S. Congress, the U.S. annual power loss is about 250 to 75 billion U.S. dollars. Infrastructure has led to large areas of power outages, and this phenomenon is becoming more and more frequent. With high peak pressures, grid operators need to use multiple methods to balance short-term fluctuations in supply and demand.
The pain points of these traditional Utilities in the United States have become potential opportunities for LO3 Energy. Blockchain technology can perfectly solve the above problems. With the decline of energy storage prices, consumers are further stimulated to start their own energy arbitrage based on energy storage and storage solutions. Directly involved in the development of distributed energy. Blockchain technology accelerates this process and removes technical hurdles. LO3 Energy's blockchain technology has helped the United States embark on an energy decentralization path to allow power users to Consumers, as well as producers, help them deal directly with each other in the electricity market.
Such results form a positive feedback. While electricity production and consumption bypass the development of utility companies toward decentralized transactions, the potential revenue of traditional utility companies will continue to decrease over the long term. With the rapid development of renewable energy, once consumers Realizing that distributed energy represented by rooftop residential PV can enable them to obtain the revenue generated by electricity sales, which will prompt more and more consumers to choose to produce their own electricity. In this change, in order to not be emerging Businesses are left behind. Utilities may automatically choose to decentralize reforms to adapt to such changes and trends.
LO3 Energy keenly grasped this trend and seized the opportunity in the market. In this trillion-dollar market, it was ready for 'takeoff'. However, it looks as if it is smooth but there are also uncertainties.
There are still risks ahead
As a start-up company, it is not right to choose the right strategy. It will certainly succeed. Many startup companies have always been making great strides, and they are in jeopardy. Finally, it is hard to escape the outcome of bankruptcy dissolution. In terms of market prospects, there are also some risks and uncertainties.
First of all, the blockchain technology is still in its infancy, and the ecology of the entire blockchain is still undergoing continuous evolution and improvement. Although LO3 Energy has successfully tested it in a small area in Brooklyn, New York, it will face future scenarios. It will be much more complex than it is now, and problems may still arise in practical applications. As the survival of LO3 Energy, if there is a problem with the blockchain technology, it will have catastrophic consequences.
Second, the decentralization process is slow, at least for now, and some key links still need policy support. However, policies always lag behind the market. In addition, the cultivation of user behavior is also a slow process. This requires a lot of foreshadowing. And this in itself takes a long process.
Of course, one of the biggest problems is funding. As a start-up company, in the face of the "bright prospects, process twists and turns," the blockchain energy application market does need a huge sum of money to support its smooth passage through the market. Incubation period, to prevent the dawn of the dawn of the first in the dark. According to the latest news, LO3 Energy obtained the financial support of the manufacturing giant Siemens. Using technology to attract funds, in essence, in exchange for time, seems to be in the moment A wise choice.
Motivated by swift efforts to make long-term success, startup companies are always full of vitality. However, this vitality is in some cases extremely vulnerable. Newcomers can be guaranteed to survive a period full of risks and uncertainties. On the contrary, aggressive tactics that are effective in one battle may be successful, but they may be more likely to fail.
On the other hand, challenging the tradition has never been a straightforward journey. Start-up companies need to be well prepared, not greedy for short-term success, and should be prepared for long-term battles. After all, they can survive until the victory comes. Success. Therefore, when necessary, look for cooperation and improve internal strength. Only when the weather is over can you be able to fly.