Tokenizing Energy is the Future

Chloe Diamond
Sea Foam Media & Tech
4 min readAug 26, 2018


Source: Rodolfo Clix

While researching for this article, I couldn’t help but think about how archaic the idea of centralised energy distribution is. Large power plants providing electricity to the masses via a centralised grid seems impractical, slow, and expensive, particularly when considering the huge number of people who rely on it.

I endured many school trips to our natural gas power plants in Oxfordshire, England in which we were encouraged to start thinking about energy production and, thankfully, renewable alternatives. Despite many brainstorming sessions, I couldn’t quite comprehend the sheer scale of what I was witnessing. The plants themselves were hard to ignore in the midst of the countryside, not to mention the gargantuan amount of energy they should produce to maintain every household, which is approximately 4.648 per kWh in the UK and 10,766 kWh in the US annually.

As technology progresses, such old-fashioned approaches need to be rethought. Bringing blockchain to the energy sector has the potential to transform how people engage with these utilities by bringing control and transparency back to the end users and offering solutions for people who have been neglected by traditional systems.

Transparent Energy Costs & Crypto Payments

Until now, energy rates have been determined solely by centralised authorities, whether that’s the energy supplier or government. In California for example, the government has artificially-inflated energy rates to deter users from using particular types of energy, making it costly for those who cannot afford alternatives.

Introducing blockchain technology and cryptocurrency payments to this sector means rates can be adjusted according to supply and demand signals in the market rather than a third-party enforcer. This makes energy costs fairer and more transparent for everyone involved, and by using cryptocurrency to pay for energy the entire process will run more smoothly by eliminating slow transaction times.

Tokenizing the Energy Grid

Cryptocurrencies can also be used to tokenise the grid, facilitating a variety of energy market transactions. One example of this is Zome, which plans to reward consumers in tokens for saving energy. It will also allow building owners to generate revenue for discharging energy to the grid when demand is high.

Zome will achieve this in part through integration with IoT smart home devices and a mobile app. This will provide consumers and businesses with an effective way to track their energy usage and receive notifications when appliances are not being used optimally. Users will then be rewarded with tokens for responding accordingly.

Energy Storage as Value & Energy as a Service

Source: Carl Attard

As traditional energy distribution systems struggle to keep up with increasing demand, especially during peak hours, the importance of technologies like Distributed Energy Resources (DER) cannot be understated.

DERs are small-scale units of energy generation that are connected to the grid at the distribution level. They usually include (but are not limited to) rooftop solar panels, wind turbines, electric vehicles (EV) and EV chargers, and natural gas turbines.

The ability to store this energy is vital, not only in situations of power disruption but also as a means for people in rural areas to support their local businesses and communities. In an example from one of our partners, Energy-as-a-Service can be delivered to rural communities through portable battery packs (solar or others) to be powered up on farms for cold-chain storage and supply chain. Supply chains on the blockchain is a clear use case, but with a token solution, rural farmers can be rewarded for their participation and given greater access to these services.

Peer-to-Peer Energy Trading

Under current conditions in the sector, energy companies do not honour users for their loyalty, energy savings, or, in the case of renewables, energy generation.

Energy suppliers are able to manipulate costs however they would like due to the system and terms they’re operating under being unclear. This allows for consumers to be disadvantaged because of factors outside of their control, such as their geography, the type of fuel being generated, and the technology available in that region.

Powerledger, a Perth-based blockchain energy company, offers an alternative to this problem by allowing consumers to trade energy between themselves, providing a platform for small communities to exchange self-generated energy with ease. They have already initiated several successful trials in neighbourhoods across Western Australia, where neighbours have begun trading solar energy in a semi-regulated environment with success.


Although we’re just beginning to think about how blockchain could impact the energy sector, emerging initiatives already reveal how much technology could solve persistent problems within the space while improving conditions for many communities.

As increasingly more people become aware of the effect their energy consumption has on the environment, the shift towards environmentally-sound alternatives will gain more force, as well as the ability to take control over our personal energy footprint.

Managing our own domestic and corporate energy usage allows us to make informed decisions, gain transparency of the energy market, share surplus energy with our peers and liberate those who still struggle with lack of access and regular power outages. However we progress, future solutions should be adaptive and efficient, ensuring ultimate compatibility with a variety of demands and environments.

Sea Foam Media is a blockchain, ICO & STO agency headquartered in San Francisco, with representation in New York and London. I work out of our London office as the Director of Media.

Sea Foam Media provides end-to-end services for our clients, including whitepaper development, technology vision and architecture, token economics, digital marketing, PR, web and mobile app development, private blockchain network development, and smart contracts.

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