Most Popular

Header Ad

Innovation Technology towards a desired circular economy

Photo by Zbynek Burival on Unsplash
Raffaella Aghemo

Energy systems are undergoing rapid change to accommodate the growing volumes of integrated renewable energy production and are therefore on the verge of entering the digital age. But the “wind of change,” the transition to a more sustainable and secure energy system, has very high investment costs. Intelligent management and control are therefore needed, which is an increasingly difficult task as energy systems are becoming more active, decentralised, complex, and “multi-agent.” Distributed control and management techniques are needed to keep pace with these decentralisation and digitisation trends.

Energy companies are reporting higher and higher energy costs and lower revenues. Any potential for cost reduction and efficiency improvements in the operation of energy systems and markets can be significant.

The main properties of blockchain technology are essentially:

– Transparency: all participants can view every transaction executed;
– decentralisation;
– irreversibility: once a transaction is entered, it cannot be changed or deleted;
– disintermediation, i.e. the absence of vigilant governance.

Being a decentralized system, there is no central authority that is responsible for the correctness of the information entered, but all participants contribute to forming consensus, a consensus that is the result of the meeting of subjects who not only do not know each other, but who do not trust each other!
We are currently used to using electricity as consumers, never as producers. An electricity grid is defined smart — Smart Grid — if it is equipped with intelligent sensors, which collect information in real-time, to rationalize the distribution of energy. The information comes from a multitude of terminals: from users, large hubs, meters, vehicles.

Smart Grids, i.e. the combination of an information network with an electricity distribution network, use exchange platforms to manage consumption in an analytical and rather precise way and reduce waste to a minimum. It could become possible, with the use of block technology, an exchange between those who have excess energy and those who need it, creating the “sharing economy” system that has made the success of Airbnb or Bla Bla Car, to name just two.

The blockchain could potentially provide solutions through the energy trilemma: they could reduce costs by optimizing energy processes, improve security in terms of information security, but also act as a supporting technology that could promote sustainability, facilitating the production of renewable energy.

The so-called energy imbalance through the new means could move to new borders: imbalances may take from a few months up to two years to be finalized. The main reasons for the delays found are the long processes of reconciliation, volume discounting, and confirmation. Blockchain technology could reduce costs and delays, triggering a more efficient and effective system. Future energy systems should be based on three key principles: decarbonization, decentralisation, and digitisation, with a shift towards the consumer-centric system.

Blockchain has the potential to increase efficiency by standardizing regulatory reporting requirements and data formats across multiple organizations. The oil and gas supply chain ecosystem involves a multitude of players, including shippers, suppliers, and customers who require countless administrative checkpoints. This innovative, decentralized technology has the ability to minimize the number of intermediaries, and enables interoperability, ensuring that the entire process is executed with integrity and transparency. It would have a strong impact on the management of land sales records in the oil and gas refinery context, thus preventing possible fraud and counterfeiting (Ghana, for example, recently launched a pilot project with Bitland to register property deeds in the Kumasi region to reduce land ownership fraud).

Another potential benefit could come from the use of an oil-based digital currency. The ability to monetise a commodity such as oil and gas would significantly reduce brokerage costs. For example, oil and gas companies with high transportation costs can reconcile digital oil-based currency shipping invoices instead of using traditional fiat currencies, which require third-party brokers to settle the transaction, saving companies at least five percent of transportation costs through improved invoice accuracy, reduced overpayment, and disintermediation of third-party suppliers.

The circular economy is still the best way to guide companies and consumers into a sustainable, green future.

On June 7, 2019, the Puerto Rico Electricity Authority (“PREPA”) through its Integrated Resources Plan (“IRP”) proposed the installation of approximately 1.4 GW of solar energy and 920 MW of battery storage to execute, according to government mandate, the 100% renewable energy supply by 2050. The island’s electricity grid will be divided into eight largely self-sufficient “MiniGrids” to prevent power surges following Hurricane Maria in 2017, thus managing to serve even the most remote areas of the territory, not easily accessible from the centralized power grid.

The electric mobility market is highly topical: it must be made clear that respect for the environment also helps to save money!

The blockchain, in technological combination with IoT sensors, installed inside the cars, allows, through an algorithm verified by an international body, DNV GL, to convert the savings of carbon emissions into tokens, through the Chinese Vechain, spendable to buy other goods, within the network!
DNV GL is a world-renowned certification body that helps companies manage risk and control their organizations through verification, control and certification processes. Well this recognized body, in alliance with Vechain, provider of technological solutions, have created this “carbon ecological platform”, in which the virtuous behavior makes each user earn “points”, or tokens, called carbon credit. The lucky man, who has not only helped the environment and saved money with his behaviour, will be able to use this “treasure trove” to buy basic necessities from retailers who are members of the network.

“Whoever uses an electric car connects to the network and activates an algorithm, a smart contract based on blockchain, which calculates, according to some parameters set by us, how much the individual, using that car, has managed to save in terms of CO2”, explains Renato Grottola, Global Director DT of DNV GL.

The incentive to a given behavior must be implemented, assigning value and creating a “rewarding” system.

On the oil side, it seems that Sinochem Energy Technology, is about to launch a blockchain project, in collaboration with Shell (not new to these initiatives) and Macquarie Group: the name has already been spread, “Gateway”, and would aim to trace the long, complicated, and “crowded” oil supply-chain, trying to eliminate fraud and increase the transparency and efficiency of the supply chain.

All Rights Reserved

Raffaella Aghemo, Lawyer

    Leave a Reply

    Forgot Password