Peer-to-Beer — Solar Swap in Australia
The need for a fast shift away from fossil fuels towards renewable energy becomes even more obvious with the current situation in Ukraine. The future electricity market will therefore become rapidly more complex due to the decentralized characteristics of renewable energies. Digitalization provides an opportunity to manage this increasing complexity and improve the outdated electricity sector.
Blockchain plays an important role within the field of digitalization. It brings several potential benefits for the electricity sector, such as reduced transaction costs, increased transparency, increased security, increased automation via smart contracts, and increased participation by empowering new actors [1].
New business models are quickly emerging utilizing these advantages of the blockchain technology such as [2]:
- Peer-to-Peer electricity trading — Anyone with or without solar panels can trade electricity with their peers
- Preferential trading — Prosumers and consumers can establish their preferred buyers and sellers and set their electricity prices
- Gifted P2P — Prosumers can gift electricity to, for example, friends, neighbors, schools, and community groups including vulnerable communities and charities
- Cross Store P2P — Commercial customers can share electricity between their stores located within the same grid, even when only one has a solar PV installation
- Solar Swap — Retail brands can buy excess electricity from residents with solar panels in exchange for products/vouchers
Powerledger, a pioneer in using blockchain in the electricity sector, launched an especially creative business model based on Solar Swap in partnership with Carlton & United Breweries and Diamond Energy. It is called “VB Solar Exchange” or also known as the world’s first “Peer-to-Beer” electricity exchange scheme.
The brewery buys excess electricity from participants who own small-scale solar PV systems (up to 6 kW in combination with a smart meter) to produce their beer sustainably. The innovative twist is that the brewery does not pay money for the electricity but provides a case of beer (24 x 375ml bottles) for every $30 worth of electricity. An average Australian household earns $90 per quarter for their excess solar electricity and thus receives three cases of beer which would cost $165 at the supermarket [3].
In this win-win situation, the brewery receives low-cost green electricity to achieve their target of 100% renewable energy use, and the Solar Exchange participants receive products for their excess electricity that has double the value of the usual feed-in tariff.
This business model is made possible by Powerledger’s P2P electricity trading platform xGrid. Transactions are managed securely and fast on the blockchain. Prosumers can see their excess electricity or in other words their earned beers in real-time on the front-end user interface of the platform.
This case study shows the potential for new and creative business models if digitalization is embraced in the electricity sector. New revenue streams can be unlocked, and the use of residential solar PV can be further encouraged.
References
[1] IRENA (2019), Innovation Landscape Brief: Blockchain, Online: https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2019/Feb/IRENA_Landscape_Blockchain_2019.pdf
[2] Yandiola, CM (2022), Decentralizing the power through local energy communities — Powerledger peer-to-peer energy trading solutions, Online: https://youtu.be/M01HU9eEAvU?t=1858
[3] SmartEn (2022), Energy communities to increase local system efficiency, Online: https://smarten.eu/wp-content/uploads/2022/02/ENERGY_COMMUNITIES_to_increase_local_system_efficiency_02-2022_ONLINE-final.pdf
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Text by Christian Doedt
