Businesses will be able to Buy and Sell Renewable Energy on a Digital Market

The software trial was tested in Osaka, under the second largest utility in Japan, Kansai Electric Power Company (KEPCO) and Australia’s Power Ledger.

A blockchain-based model that provides cheaper energy systems

The actual project has been running for 5 months using information and data from 8 participating electricity meters. According to Power Ledger, if this was expanded to a larger scale, this could have saved $18.5 billion as a result of lower renewable prices.

Co-Founder and Chairman Dr Jemma Green expresses:

Power Ledger’s trial with KEPCO demonstrated how communities can be provided with cheaper energy systems to offset existing energy costs and allow energy-generating customers to monetise their renewable energy investments by selling their excess energy via Power Ledger’s P2P platform.

Japanese utilities must purchase renewables at fixed prices and for contract durations which are set by the government. But this new blockchain-based model could serve as an alternative to the current approach.

Renewable energy in Japan now and the future

Government fees have risen over time as demand has increased and consumers are paying more for renewable energy. Japanese utilities in 2019 are expected to pay $33.2 billion in renewable fees, of which $22.7 billion is passed on to businesses and households.

The purchase of renewables at a fixed price or “feed-in tariff” as the Japanese call it, was set up in 2012 to encourage long-term investment in renewable energy. As the market matures, the government will disregard the fixed price and replace it with the competitive bidding system for renewable energy in 2020 in a bid to keep costs low.

Dr Green continues,

The blockchain platform will cut out the middleman. Power Ledger will give users access to cheaper energy prices, incentivising more people to install solar panels and other types of renewable energy generators.

Renewable energy will be introduced significantly in Japan. The country needs to create stable provisions to make this possible and integrate and control decentralised energy sources, according to a KEPCO representative.