The Deutsche Energie-Agentur (dena) – the German Energy Agency – is launching a study to evaluate the use of blockchain technology for the integrated energy transition, in particular to coordinate the constantly growing number of decentralised components of the energy system across all sectors. Together with business partners, dena is investigating whether the technical conditions for blockchain are already sufficient in practice and whether digital information and communication technology applications can be operated economically and reliably in concrete business models.
“At its foundation, blockchain offers the best conditions for the exchange, validation and documentation of valuable data in an integrated energy system,” says Andreas Kuhlmann, dena’s Chief Executive. “We have come to a point where it is necessary to verify whether the technology’s potential can be implemented in practice from a technical, economic and legal standpoint. The energy system is a critical infrastructure that must work securely and be protected by digitisation at the information and communication technology level. Blockchain technology can help with that – we want our study to show precisely how.”
Practicality check: What are the limits of blockchain?
Blockchain can increase the efficiency of transactions in the energy system and enable direct exchanges while simultaneously reducing costs, such as those related to charging and billing transactions for electric vehicles. Fundamentally, however, the technology is not without competition. In financial management or online retail, for instance, blockchain competes with established IT systems. Replacing these with a blockchain is conceivable but would require investments from companies. The aim of the study is to determine the added value of blockchain compared to alternative systems in specific areas of application, but also to determine its technical and economic limits, for example with the number of transactions and the associated energy consumption. The results will be presented in spring 2019.
Blockchain is a new kind of technology for securely exchanging and storing data. Using this technology, transactions can be verified, validated and compiled into blocks. Blockchain databases are considered to be tamper-proof, since the individual information blocks are subject to complex cryptography and stored at decentralised locations. Probably the best-known use of this technology is the digital currency Bitcoin. Applications in the energy system include, for example, the optimisation of digital processes or the operation of decentralised platforms for the direct trading of electricity between photovoltaic system owners and consumers.
Partners in the blockchain study
dena is conducting the study entitled “Blockchain in the integrated energy transition” together with the following partners: BKW, cronos Unternehmensberatung, EnBW Energie Baden-Württemberg, EWE NETZ, items, ista International, Mainova, Netz Lübeck, Rheinische NETZGesellschaft, Siemens, Stadtwerke Leipzig, VERBUND. Other companies have until 15 June 2018 to participate in the study. Technological-economic validator of the study is Prof. Dr. Jens Strüker (INEWI), the regulatory framework will be assessed by Dr. Ludwig Einhellig (Deloitte). The responsible project director and contact person at dena is Philipp Richard.