Waves Enterprise’s solution: a new approach to recording electricity consumption
Waves Enterprise’s solution was showcased at the international forum “Power Grids” 2019 as one of the outcomes of a pilot project initiated by the company Rosseti.
A solution for recording electric power consumption, developed by Waves Enterprise, was among the final prototypes in a pilot project launched by Rosseti, a major power grid company.
The pilot project, “Assessment of application of blockchain technology in the retail electricity market,” was initiated to explore and analyze options for using blockchain systems for interaction between electricity manufacturers, suppliers and end-users.
The main goal of creating and testing a blockchain-based system is exploring the opportunities for achieving consistency and immutability of data for every participant in the power market.
The existing system of interaction and information exchange between electricity generators, grid and sales companies, as well as consumers, lacks transparency and trust between participants.
The lack of transparency is partially responsible for electricity bill arrears. According to the Russian government, as of September 2019 total electricity bill arrears amounted to 1.3 trillion rubles, of which households were responsible for 800 billion rubles.
But the problem is not limited to refusal to pay electricity bills by consumers who distrust data coming from electricity suppliers or provided by intermediaries. Failures can occur across the entire chain of obtaining data and making payments — from end-users to the generating company — and payments made by households don’t always reach the electricity generator.
Rosseti plans to entirely remove opportunities for manipulating data in the electricity market, including when measuring electricity use and making payments. To this end, the company is running a three-stage project aimed at gradually introducing automation on a national scale.
The project’s first stage has already been completed. In this stage, companies were asked to develop solutions for automating measurement of electricity consumption on a voluntary basis, in a pilot project involving consumers in Kaliningrad and Sverdlovsk regions.
“As a result of the first assessment stage of the project, we formulated requirements for an interaction system for electricity retail market participants, based on blockchain technology. We want to see a system of this kind,” says Sergei Semerikov, head of Rosseti’s project. “We believe that the system should be based on a private blockchain and a local platform, complying with requirements for data protection and cryptography.”
The second stage of the project will involve all consumers in the pilot regions and, in the third stage, the system should be scaled up across Rosseti’s entire area of operation.
Waves Enterprise’s solution was among the five final prototypes presented at the international forum “Power Grids” in Moscow.
“Over a short time, our team developed a fully functional system with participants’ personal accounts and a mobile app for users. We implemented integration with automated electricity metering systems in Kaliningrad and Sverdlovsk regions for 400 power consumers (individual houses and apartments in apartment buildings), and created smart contracts for calculating delivered electricity, billing and dividing consumers’ payments between grid and sales companies,” says Igor Kuzmichev, business development director for Waves Enterprise.
Waves Enterprise’s solution includes a blockchain platform, mobile and web apps, a meter and a data transfer gateway.
The solution is directly integrated with electricity meters as well as with a bank. Waves Enterprise’s partner in this project is Alfa Bank, which organizes the payment chain from the end user to the electricity manufacturer.
Electricity consumption data for each individual household is transferred directly from the meter to the blockchain, and is displayed in the app. A consumer can monitor their electricity consumption in real time. Moreover, the app analyzes energy consumption patterns and could, for instance, suggest that a user switch to a more economical plan.
Consumers pay for electricity in accordance with immutable and consistent data recorded to the blockchain. Then, a smart contract automatically divides the payment, with the sales and grid companies each receiving their respective shares.
“We believe Waves Enterprise’s participation in this project is important because a national platform should participate in the development of a national program,” comments Denis Dodon, director of Alfa Bank’s Center for Innovation Development. “It’s vital for the developer to be located in Russia and to be able to respond to issues and challenges that exist within the country.”
In the second stage of Rosseti’s project, a contest will be announced and applicants will be offered technical specifications for developing an enterprise solution. Based on the contest’s outcome, a contractor for the entire automated electricity metering program in Russia will be selected.
However, regardless of the contest’s outcome, a number of electricity sales and grid companies have already expressed interest in Waves Enterprise’s solution.
Meanwhile, the power industry is one of the most promising fields for blockchain adoption on a global scale. As of late summer of this year, the total investment in blockchain projects in the electricity sector reached almost $600 million. This investment, according to a report by the company MindSmith and the Energy Center at Moscow’s Skolkovo management school, went to 234 blockchain projects.