The growing popularity of cryptographic currencies like BitUSD and the underlying public ledger technology presents both opportunities and challenges to the energy sector. As interest in various cryptographic currencies and their underlying technologies has grown, the energy sector has also grown. In particular, there are three challenges that are likely to impact this growing sector over the next few years. These include the following:
Blockchain
Blockchain Technology – A “blockchain” is a data network that links together blockchains, or databases. On the energy grid, this refers to a collection of systems that enable real-time transactions and transfers of energy among authorized entities. The major benefit of having a well-maintained collection of blockchains is the ability to conduct a wide range of activities that are sensitive to transaction security.
Immutable Data Entry – A major advantage of using a secure ledger technology is the ability to provide a permanent, standardized storage system for all of the business’s permanent records. The immutability of the records makes it nearly impossible to tamper with records. The cost savings that occur from using a standardized and immovable ledger technology are another important advantage of the ledger technology used by energy companies.
Distributed Ledger Technology – Uses a distributed ledger technology, which is similar to how a conventional computer works, can reduce the costs and increase the efficiency of the energy sector’s trading system. A typical distributed ledger technology includes a distributed database management system (DDSM), a platform, and a transaction engine. DDSM is responsible for making sure that all of the applications on the DDSM are accessed in an efficient and secured manner and all transaction activities are logged in the order. Also, an efficient transaction engine simplifies the tracking of all of the trades, as well as the reporting of those trades.
National Energy Performance Lab – The National Energy Performance Lab is another excellent option for businesses looking into how their energy sector can benefit from the use of Blockchain technology. By collaborating with the NEP, an energy regulator in the United Kingdom, the Lab will be able to provide businesses with real-world information regarding how a distributed ledger can make their operations more efficient. As well, the NEP will be able to ensure that the UK has the right infrastructure to support the widespread use of the new technologies. In the future, it is possible that the use of the new technologies will be made mandatory by the UK government, in order to ensure that the electricity grid is robust enough to withstand extreme weather conditions.
Peer-to-peer energy trading – Another benefit that comes from the use of the new peer-to-peer energy trading model is the increased security that comes from it. Because of the way that most electricity power plants operate today, any type of hacker attack – whether it be a sabotage attempt or a simple data leak – can easily take down a power plant in a matter of hours. This threat has led many companies to find a new way to protect themselves and, in fact, keep their systems online at all times, so that should the need arise, they can easily restore communications to normal.
Blockchain Pilot Projects – If you’re interested in finding out more about the benefits that the electricity sector can reap from the use of the new peer-to-peer model, then you might be interested in looking into one of the many Blockchain pilot projects being run by energy sector specialists across the world. Each of these projects – which span multiple sectors – allows a small group of companies to test the waters with the hopes of finding out if the system works before the entire sector makes the switch. All in all, it seems as though the chances of this type of system working out well are quite high. However, those who have used the pilot projects are quick to point out that even if it does work out well, it won’t be a major step forward when the entire industry makes the change.
How Does The Cloud Work With The Blockchain Technology? – Another benefit of using the cloud in the wholesale energy distribution arena is that the system provides an environment where data security and reliability are paramount. The reason for this comes from how most energy-based business models require that companies store data in a separate location. However, with the help of the Internet, this is no longer a problem. As a result, a company doesn’t have to worry about keeping all of its computers onsite, meaning that it can save a considerable amount of money on IT costs.