How Blockchain Can Democratize Green Power
By Srinivasan Keshav
Imagine buying a solar panel from a hardware store, mounting it on your roof, then selling the green electricity you produce at a price you set.
Is this even possible? Some companies certainly think so. These startups are harnessing the power of blockchains to democratize green power.
Before you can understand how blockchains are part of the solution, you first need to know a few things about the green electricity market.
Today, independent auditors assess renewable energy producers and certify their electricity as "green." These producers can then sell Renewable Energy Certificates (RECs) to consumers who want to buy green energy.
This is how corporations such as Apple and Google can say they are 100 percent green. They aren't generating their own green electricity, but rather purchasing certificates from green-energy producers.
Of course, the actual energy they use is not always green. As long as every unit of energy they consume matches up with a purchased REC, green energy is displacing carbon-intense energy. A market for RECs creates a strong signal for investment in green electricity generation.
Some companies do power some or all of their operations using Power Purchase Agreements (PPAs). This commits them to purchasing a certain amount of energy at a certain price from renewable-energy producers over time-scales of about 20 years or so. PPAs reduce risk for generators by guaranteeing return on investment, thus creating a strong motivation for long-term investment in green generation.
Both of these approaches, however, discriminate against small generators of green electricity.
It's Not Easy Generating Green
The certification process for RECs is cumbersome and expensive, with physical audits, so it doesn't make sense for mom-and-pop green generators. Similarly, PPAs can only be negotiated by large green generators.
For these two reasons, small-scale green generators must make do with whatever price their local utility pays them. This price can be volatile due to meddling by legislators as well as by the utilities themselves. Thus, small generators are exposed to higher levels of risk than bigger players.
What if we could reduce the cost of certification, eliminate onerous auditing and avoid non-market price controls, so that even a small-scale green generator could de-risk investments?
This is what companies such as PowerLedger in Australia and LO3 Energy in Brooklyn provide. They use blockchains to store generation certificates that are created by tamper-proof meters attached to solar panels.
These blockchains also store transaction records when the certificates are traded, so that the same unit of generation cannot be resold. By eliminating auditors, transaction costs and price regulation, this solution makes renewable-energy investment attractive even for small players.
A Scaling Problem
Unfortunately, this approach has a scaling problem.
Today's blockchains cannot support the addition of more than a few hundred certificates or trades (we'll call them both "transactions") per second. This is because blockchain servers need to agree on the contents of each block, despite server and communication failure and the presence of malicious servers. This is the well-known and difficult "consensus problem." Because of this problem, the scale needed to support hundreds of millions of solar panels is beyond the reach of current blockchain technology.
For instance, BitCoin, the best-known blockchain, supports only about 10 transactions per second and HyperLedger, IBM's competing solution, under 1,000 transactions per second. A democratic REC system would generate transactions at a rate hundreds of times faster.
Blockchains can store generation certificates linked to green energy, but are currently unable to handle the volume that would be produced by a large-scale deployment of solar panels.Shutterstock
My colleagues at the University of Waterloo have recently devised a new solution to the consensus problem called Canopus.
Canopus takes a server's location on the internet cloud into account, minimizing communication between geographically-distant servers. By keeping most communications local and fast, blockchain servers can process far more transaction records each second than a traditional consensus protocol that doesn't take location into account. This improvement in scaling allows even mom-and-pop green generators to obtain certificates and participate in energy transactions.
One Million Transactions Per Second
We are currently building a prototype blockchain using Canopus that we hope will handle more than one million transactions per second. In our solution, smart meters attached to solar panels send RECs to brokers. Consumers can purchase these RECs using their own brokers.
If successful, our work will encourage homeowners and small businesses to invest in renewable energy technologies to become green generators. It would also encourage Ontario's electricity consumers to become 100 percent green, just like Apple and Google.
Indeed, since blockchain knows no boundaries, our system could allow green generators in sun-drenched developing countries to recoup their investment in green generation by selling RECs to consumers around the world. Of course, this requires placing blockchain servers in every region of the world, but this is easily done using existing datacenter infrastructure.
This would reduce the global carbon footprint, and would be more efficient—thus less costly—than deploying solar panels in sun-poor northern countries.
Blockchains Are for EVs Too
The development of a scalable, tamperproof and globally accessible energy blockchain would enable other energy transactions.
Emissions-free electric vehicles (EVs) allow consumers to use electricity instead of gasoline to meet their transportation needs. While consumers get incentives to purchase EVs, they receive none to operate them.
Blockchain makes it possible to reward EV owners for operating their EVs, or providing ancillary services to utilities, making the vehicles more affordable. EV owners could be further rewarded if they charged their cars with green electricity.
Close to Reality?
Although the technology for building scalable blockchains will soon exist, one problem is that some jurisdictions, including Ontario, give local distribution companies tight control on integrating green generation to ensure grid stability.
While this is certainly necessary, there is no intrinsic need for green generators to be tied into a provincially mandated pricing plan such as the microFIT scheme. The province should allow generators to sell their electricity to the highest bidder, just like any other producer.
We also need to build, deploy and critically evaluate small-scale prototypes of blockchain-based transactive-energy systems so that we can learn by doing.
As solar and wind costs continue to drop and energy storage technologies reach maturity, it is becoming possible to turn away from carbon-intense electricity generation and gasoline vehicles.
Democratizing the deployment of these technologies using scalable energy blockchains will, we hope, accelerate this important societal transformation.
Reposted with permission from our media associate The Conversation.
By Dana M Bergstrom, Euan Ritchie, Lesley Hughes and Michael Depledge
In 1992, 1,700 scientists warned that human beings and the natural world were "on a collision course." Seventeen years later, scientists described planetary boundaries within which humans and other life could have a "safe space to operate." These are environmental thresholds, such as the amount of carbon dioxide in the atmosphere and changes in land use.
The Good and Bad News<p><span>Ecosystems consist of living and non-living components, and their interactions. They work like a super-complex engine: when some components are removed or stop working, knock-on consequences can lead to system failure.</span></p><p>Our study is based on measured data and observations, not modeling or predictions for the future. Encouragingly, not all ecosystems we examined have collapsed across their entire range. We still have, for instance, some intact reefs on the Great Barrier Reef, especially in deeper waters. And northern Australia has some of the most intact and least-modified stretches of savanna woodlands on Earth.</p><p><span>Still, collapses are happening, including in regions critical for growing food. This includes the </span><a href="https://www.mdba.gov.au/importance-murray-darling-basin/where-basin" target="_blank" rel="noopener noreferrer">Murray-Darling Basin</a><span>, which covers around 14% of Australia's landmass. Its rivers and other freshwater systems support more than </span><a href="https://www.abs.gov.au/ausstats/[email protected]/latestproducts/94F2007584736094CA2574A50014B1B6?opendocument" target="_blank" rel="noopener noreferrer">30% of Australia's food</a><span> production.</span></p><p><span></span><span>The effects of floods, fires, heatwaves and storms do not stop at farm gates; they're felt equally in agricultural areas and natural ecosystems. We shouldn't forget how towns ran out of </span><a href="https://www.mdba.gov.au/issues-murray-darling-basin/drought#effects" target="_blank" rel="noopener noreferrer">drinking water</a><span> during the recent drought.</span></p><p><span></span><span>Drinking water is also at risk when ecosystems collapse in our water catchments. In Victoria, for example, the degradation of giant </span><a href="https://theconversation.com/logging-must-stop-in-melbournes-biggest-water-supply-catchment-106922" target="_blank" rel="noopener noreferrer">Mountain Ash forests</a><span> greatly reduces the amount of water flowing through the Thompson catchment, threatening nearly five million people's drinking water in Melbourne.</span></p><p>This is a dire <em data-redactor-tag="em">wake-up</em> call — not just a <em data-redactor-tag="em">warning</em>. Put bluntly, current changes across the continent, and their potential outcomes, pose an existential threat to our survival, and other life we share environments with.</p><p><span>In investigating patterns of collapse, we found most ecosystems experience multiple, concurrent pressures from both global climate change and regional human impacts (such as land clearing). Pressures are often </span><a href="https://besjournals.onlinelibrary.wiley.com/doi/abs/10.1111/1365-2664.13427" target="_blank" rel="noopener noreferrer">additive and extreme</a><span>.</span></p><p>Take the last 11 years in Western Australia as an example.</p><p>In the summer of 2010 and 2011, a <a href="https://theconversation.com/marine-heatwaves-are-getting-hotter-lasting-longer-and-doing-more-damage-95637" target="_blank" rel="noopener noreferrer">heatwave</a> spanning more than 300,000 square kilometers ravaged both marine and land ecosystems. The extreme heat devastated forests and woodlands, kelp forests, seagrass meadows and coral reefs. This catastrophe was followed by two cyclones.</p><p>A record-breaking, marine heatwave in late 2019 dealt a further blow. And another marine heatwave is predicted for <a href="https://www.theguardian.com/environment/2020/dec/24/wa-coastline-facing-marine-heatwave-in-early-2021-csiro-predicts" target="_blank" rel="noopener noreferrer">this April</a>.</p>
What to Do About It?<p><span>Our brains trust comprises 38 experts from 21 universities, CSIRO and the federal Department of Agriculture Water and Environment. Beyond quantifying and reporting more doom and gloom, we asked the question: what can be done?</span></p><p>We devised a simple but tractable scheme called the 3As:</p><ul><li>Awareness of what is important</li><li>Anticipation of what is coming down the line</li><li>Action to stop the pressures or deal with impacts.</li></ul><p>In our paper, we identify positive actions to help protect or restore ecosystems. Many are already happening. In some cases, ecosystems might be better left to recover by themselves, such as coral after a cyclone.</p><p>In other cases, active human intervention will be required – for example, placing artificial nesting boxes for Carnaby's black cockatoos in areas where old trees have been <a href="https://www.environment.gov.au/biodiversity/threatened/publications/factsheet-carnabys-black-cockatoo-calyptorhynchus-latirostris" target="_blank" rel="noopener noreferrer">removed</a>.</p><p><span>"Future-ready" actions are also vital. This includes reinstating </span><a href="https://www.abc.net.au/gardening/factsheets/a-burning-question-fire/12395700" target="_blank" rel="noopener noreferrer">cultural burning practices</a><span>, which have </span><a href="https://theconversation.com/australia-you-have-unfinished-business-its-time-to-let-our-fire-people-care-for-this-land-135196" target="_blank" rel="noopener noreferrer">multiple values and benefits for Aboriginal communities</a><span> and can help minimize the risk and strength of bushfires.</span></p><p>It might also include replanting banks along the Murray River with species better suited to <a href="https://www.abc.net.au/gardening/factsheets/my-garden-path---matt-hansen/12322978" target="_blank" rel="noopener noreferrer">warmer conditions</a>.</p><p>Some actions may be small and localized, but have substantial positive benefits.</p><p>For example, billions of migrating Bogong moths, the main summer food for critically endangered mountain pygmy possums, have not arrived in their typical numbers in Australian alpine regions in recent years. This was further exacerbated by the <a href="https://theconversation.com/six-million-hectares-of-threatened-species-habitat-up-in-smoke-129438" target="_blank" rel="noopener noreferrer">2019-20</a> fires. Brilliantly, <a href="https://www.zoo.org.au/" target="_blank" rel="noopener noreferrer">Zoos Victoria</a> anticipated this pressure and developed supplementary food — <a href="https://theconversation.com/looks-like-an-anzac-biscuit-tastes-like-a-protein-bar-bogong-bikkies-help-mountain-pygmy-possums-after-fire-131045" target="_blank" rel="noopener noreferrer">Bogong bikkies</a>.</p><p><span>Other more challenging, global or large-scale actions must address the </span><a href="https://www.youtube.com/watch?v=iICpI9H0GkU&t=34s" target="_blank" rel="noopener noreferrer">root cause of environmental threats</a><span>, such as </span><a href="https://www.nature.com/articles/s41559-018-0504-8" target="_blank" rel="noopener noreferrer">human population growth and per-capita consumption</a><span> of environmental resources.</span><br></p><p>We must rapidly reduce greenhouse gas emissions to net-zero, remove or suppress invasive species such as <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/mam.12080" target="_blank" rel="noopener noreferrer">feral cats</a> and <a href="https://theconversation.com/the-buffel-kerfuffle-how-one-species-quietly-destroys-native-wildlife-and-cultural-sites-in-arid-australia-149456" target="_blank" rel="noopener noreferrer">buffel grass</a>, and stop widespread <a href="https://theconversation.com/to-reduce-fire-risk-and-meet-climate-targets-over-300-scientists-call-for-stronger-land-clearing-laws-113172" target="_blank" rel="noopener noreferrer">land clearing</a> and other forms of habitat destruction.</p>
Our Lives Depend On It<p>The multiple ecosystem collapses we have documented in Australia are a harbinger for <a href="https://www.iucn.org/news/protected-areas/202102/natures-future-our-future-world-speaks" target="_blank">environments globally</a>.</p><p>The simplicity of the 3As is to show people <em>can</em> do something positive, either at the local level of a landcare group, or at the level of government departments and conservation agencies.</p><p>Our lives and those of our <a href="https://theconversation.com/children-are-our-future-and-the-planets-heres-how-you-can-teach-them-to-take-care-of-it-113759" target="_blank">children</a>, as well as our <a href="https://theconversation.com/taking-care-of-business-the-private-sector-is-waking-up-to-natures-value-153786" target="_blank" rel="noopener noreferrer">economies</a>, societies and <a href="https://theconversation.com/to-address-the-ecological-crisis-aboriginal-peoples-must-be-restored-as-custodians-of-country-108594" target="_blank" rel="noopener noreferrer">cultures</a>, depend on it.</p><p>We simply cannot afford any further delay.</p><p><em><a rel="noopener noreferrer" href="https://theconversation.com/profiles/dana-m-bergstrom-1008495" target="_blank" style="">Dana M Bergstrom</a> is a principal research scientist at the University of Wollongong. <a rel="noopener noreferrer" href="https://theconversation.com/profiles/euan-ritchie-735" target="_blank" style="">Euan Ritchie</a> is a professor in Wildlife Ecology and Conservation, Centre for Integrative Ecology, School of Life & Environmental Sciences at Deakin University. <a rel="noopener noreferrer" href="https://theconversation.com/profiles/lesley-hughes-5823" target="_blank">Lesley Hughes</a> is a professor at the Department of Biological Sciences at Macquarie University. <a rel="noopener noreferrer" href="https://theconversation.com/profiles/michael-depledge-114659" target="_blank">Michael Depledge</a> is a professor and chair, Environment and Human Health, at the University of Exeter. </em></p><p><em>Disclosure statements: Dana Bergstrom works for the Australian Antarctic Division and is a Visiting Fellow at the University of Wollongong. Her research including fieldwork on Macquarie Island and in Antarctica was supported by the Australian Antarctic Division.</em></p><p><em>Euan Ritchie receives funding from the Australian Research Council, The Australia and Pacific Science Foundation, Australian Geographic, Parks Victoria, Department of Environment, Land, Water and Planning, and the Bushfire and Natural Hazards CRC. Euan Ritchie is a Director (Media Working Group) of the Ecological Society of Australia, and a member of the Australian Mammal Society.</em></p><p><em>Lesley Hughes receives funding from the Australian Research Council. She is a Councillor with the Climate Council of Australia, a member of the Wentworth Group of Concerned Scientists and a Director of WWF-Australia.</em></p><p><em>Michael Depledge does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</em></p><p><em>Reposted with permission from <a href="https://theconversation.com/existential-threat-to-our-survival-see-the-19-australian-ecosystems-already-collapsing-154077" target="_blank" style="">The Conversation</a>. </em></p>
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