The WePower business model is presented in a whitepaper. After reading it, most likely, you will consider WePower from several different perspectives:
- The perspective of a renewable energy producer
- The perspective of an investor or producer in today’s energy market
- The perspective of an energy consumer
- The perspective of a contributor (those holding WePower tokens).
This article will concentrate on the key problems WePower addresses and the benefits it provides for each of the above-mentioned groups of persons.
Renewable energy producer
Let’s say that you are a developer of renewable energy (solar, wind, hydroelectric) plants. You have a great amount of experience and a proven track record in the renewable energy sector. You have just bought a land in, for example, Portugal. The sun shines there for more than 300 days a year. It’s a perfect place to develop a renewable energy plant and to produce and sell energy at the market price. You can already imagine the social and monetary rewards of being a green energy producer.
As an experienced renewable energy producer, you know that a 1 MW energy plant will cost you around EUR 900,000 — EUR 1,000,000. You know that you will need an additional EUR 700,000 to achieve this goal, and this cannot be done without debt financing.
You come to your bank and tell your friend, who is the bank’s manager, that you have an amazing project and you need cash to start it. Unfortunately, your banker friend says that 30% of your own funds is not enough. Subsidies are gone. The project is considered too risky and the bank now requires a debt to equity ratio of 50:50.
However, you are confident that your project is great and will succeed, so you start looking for the needed capital. In the end, you realize that this will be a long, costly and unpleasant process. The search for equity capital will cost you somewhere around 3% to 5% of the total project cost. This does not even guarantee that you that you will get the necessary capital. You start struggling, but your friend tells you about a new company that has now emerged from the energy market — WePower.
After some consideration, you decide to give WePower a try. The green guys from WePower do their due diligence and tell you: “Hey, you can sell part of the energy to be produced by your project in the future upfront by using our blockchain-based platform and smart contracts.”
OK, this sounds a little scary, but you need that capital and you give WePower another try.
The green guys allow you to sell the energy to be produced in the future upfront for the amount of EUR 200,000. This amount of energy is tokenized using WePower and sold in the form of energy tokens to the energy buyers/investors using WePower. However, you sell this energy lower than the current market price — you are hedging on future sales to get the capital you need right now. You get the required equity capital and go to the bank to get the rest of the funds. Once you start construction of the plant, you connect it to the platform and start providing energy to the grid. At the very moment the green energy is produced and has reached the grid, the energy tokens are burned and represent the claim of the buyer/investor to receive the proceeds of the energy liquidation. This is done via smart contracts, according to the power purchase agreements, and is accomplished with full transparency, speed, and liquidity.
So, what does this mean for you?
1.You don’t need to get an additional investor and you can acquire the necessary equity amount needed to get debt financing. Even though you may already have the necessary funds for such a project, you could scale up even faster with the WePower model.
2.Your return on equity ratio (ROE) will increase by up to 25%, which means that you can reinvest more funds into the production of renewable energy. How did we arrive at these numbers? Simple. Once the delivery of energy according to the initially concluded smart contracts has been accomplished, the producer can begin selling the rest of the energy produced at the market price. The producer receives the full benefits of the plant’s energy sales, sharing the benefits of lower energy prices with the consumers and taking advantage of the higher future income flow with less capital initially invested.
Investor/energy market maker
As an investor, you are looking for highly profitable, safe and liquid investment options. Investments in the energy market rarely cross your mind.
This sector is usually only open for guys with deep pockets — guys like institutional investors. Suddenly you meet the green guys from WePower, and they invite you to explore WePower as a blockchain-based renewable energy trading platform with the goal of becoming the next generation utility company.
WePower allows you to buy renewable energy that will be produced in the future.
STOP.
Renewable energy that will be produced in the future? Yes, you are right!
You are buying a tangible asset that has been agreed upon — green energy. You are buying it for a price lower than the market price and selling it whenever you want to — directly on the WePower platform. Today you could fix the energy price at 0.039 Eur/kWh, while the market price is 0.047 Eur/kWh, and your return, depending on when the energy is produced, could be crazy — up to 17–20%.
But then you may think: “Wait for a second, but what I will do with the energy I have bought?” You can either use it if WePower is operating in your country as a renewable energy user, sell it on the market before the energy is produced, or simply do nothing. If you choose to do nothing, this energy is automatically sold on the global energy exchange market and you get the margin resulting from the difference in the price paid for the energy and the market price, which should grow each year.
When looking at your investment using WePower, you feel happy. Your investment is backed by real, tangible assets — green energy. Due to smart contracts, it is liquid. You can always see how your investment is doing on the public blockchain. You are putting more funds into the energy sector, because by doing business, you also doing good, by supporting the adoption of renewable energy.
The same thing applies to energy market makers. They can fix the energy price and hedge it with a liquidity option, which can be executed when they want to.
Energy user
It works the same way for investors. You are buying future energy at a discount and saving the price difference between the price paid now and the future market price when the energy is produced. WePower, as an independent energy supplier, has the right to provide you with the electricity. However, WePower can only provide you with this service when it enters your market.
This might take some time, but with your help, WePower can become a global business.
Moreover, nowadays you cannot choose what kind of energy to use. It’s always dirty energy, and its production pollutes our planet. With WePower, you could choose what kind of energy you want to buy and always be able to observe its production on the public blockchain. You would always get green certificates, allowing you to see how much CO2 was cut and how you have contributed to a better world.
Contributor
As a contributor, you may ask yourself whether you need WPR tokens in your crypto wallet. You, just like any one of us, don’t like paying bills, right? Imagine a world where you don’t have to pay for your household’s electricity consumption. It’s a good feeling. With WPR tokens, it could become a reality.
Renewable energy producers using WePower are required to donate part of the energy to the community — to the token holders. This means that token holders constantly receive green energy as a reward for contributing to the platform. Constantly. If the expansion of WePower is successful, the amount of the green energy donated grows by a huge amount. The energy you receive will allow you to forget energy bills or sell the energy and use the proceeds from it to cover the same energy bills.
Whichever of these groups of people you belong to or about to become a member, WePower brings not only the value of being green or acting green. By now you can see yourself, that our platform is able to generate financial benefits along with the personal satisfaction of doing good and making the change happen.
And frankly, you are one click away from becoming a part of this change.
