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Siemens to take part in a new project with the US-based blockchain startup that will enable energy transfers through the distributed ledger technology.
The New York-based blockchain startup, LO3 Energy, has teamed up with Siemens to develop innovative microgrids that allow local energy trading using the blockchain technology.
LO3 Energy is being supported by Siemens’ Digital Grid and next47, a unit that was set up by Siemens earlier this year to discover innovative technologies that will create new opportunities for the company.
The first blockchain microgrid is planned to be implemented in Brooklyn, New York. The other joint microgrid projects are expected to be realized in other parts of the US as well as outside the country.
“The constant evolution at the grid edge requires advanced control, automation and data analytics technologies enabling secure, stable and reliable integration of decentralized energy systems as well as supporting the establishment of new business models,” said CEO of Siemens’ Energy Management Division, Ralf Christian, in a press-release.
“We’re convinced that our microgrid control and automation solutions, in combination with the blockchain technology of our partner LO3 Energy, will provide additional value for our customers whether on the utilities side or on the prosumer side,” he added.
LO3 Energy will integrate Siemens’ microgrid control solution with its peer-to-peer trading platform, called TransActive Grid. The system was developed to urge people produce energy using renewable sources, thus reaching cleaner environment. The microgrid links energy producers allowing them to buy and trade electricity depending on their requirements.
“In the world of finance, blockchain technology is rapidly advancing across many sectors, but in the energy market, things are comparatively different. With our microgrid solution in Brooklyn, we’ll demonstrate just the beginning of what blockchain can do in the transactive energy world,” said LO3 Energy’s founder, Lawrence Orsini.
All transactions as well as energy production will be tracked with the use of blockchain smart contracts based on Ethereum platform. Each unit of energy transferred through the microgrid will be recorded. The project will encourage people to make energy by themselves, what will minimize their dependency on the national grid.
The first energy transactions between neighbors were successfully tested in April 2016. “Just as our partner LO3 Energy we are envisioning tremendous opportunities for the application of the blockchain technology, especially in microgrids with distributed and decentralized energy systems. Its big benefit is, that it permits transparent, efficient trading between multiple participating systems and various stakeholders while taking grid-specific requirements into account”, said Thomas Zimmermann, chief executive officer of Siemens’ Digital Grid Business Unit.
Siemens is currently focused on the blockchain technology as it is committed to grow its business in such sectors as decentralized electrification and artificial intelligence. Earlier this year, the company unveiled plans to invest $1.1 billion within the next five years in new startups that will help Siemens to develop in these innovative areas.
In view of the growing investment in the blockchain technology around the globe, R3 CEV has recently announced a new fundraising it plans to get from bank members interested in the investment. As we earlier reported, most of the banks expressed their interest in the initiative, while some of the members refused to invest.
One of the latest projects involving the blockchain technology is a blockchain proof-of-concept solution developed by Australian travel firm Webjet and tech giant Microsoft. The new project is expected to transform travel industry processes and improve online payments for hotel bookings.