A blockchain startup in the United States is working to “democratize the energy industry” which has raised an unknown sum from the British oil conglomerate, Royal Dutch Shell and the Japanese giant Sumitomo Corporation Group.
As was announced on Wednesday, LO3 Energy said that it has developed a “transactive energy platform” to address the challenge of tracking energy from different sources across supply networks.
The investment director at Shell Ventures, Kirk Coburn has stated:
“As we move into a less carbonized future, Shell aims to invest in innovative companies that will help enable the energy transition. LO3 Energy fits right in that space.”
Thanks to the LO3 system, a mobile app allows users to select from different local energy resources and will further allow them to choose to the desired supplier.
So while the electricity will pass through the power grid like usual, a “private, permissioned blockchain” will keep track of the deals of the energy source and the purchase agreement.
The whitepaper for the project states that LO3’s blockchain, dubbed ‘exergy’ has many aims for the future, as it says:
“Exergy will utilize a blockchain-based token system to reduce barriers and facilitate the optimal coupling of local electric generation with parties that can evaluate, generate, store, trade, and utilize this generation most efficiently. This is squarely a customer-centric model—where customers (who may increasingly be operating within a microgrid ) own and operate the DER assets. This supports a growing distributed energy ecosystem that best serves its own load demands in normal use, while coincidentally opening up direct and derivative service value streams to peripheral distribution system operators (DSO).
This is more of a traditional utility enterprise that would be able to make use of the microgrid for its more broader system balancing needs and provide energy transport services to connect up adjacent microgrids as it evolves its business model.
On top of this, the firm has said that its product could power a range of business use cases, including “peer-to-peer energy trading, energy hedging for businesses, virtual power plants, dynamic electric vehicle charging and demand response.”
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