As established, blockchain technology is not only useful in the finance and trade sector but has its applications in other industries as well like music, governance, business, and cyber security to name a few. Another sector to be greatly influenced by blockchain technology is energy. It is believed that blockchain technology can give us smarter energy grids. Energy experts believe that this can be achieved because blockchain technology has the potential to solve the complex red tape maze and management problems.

What is Blockchain Security

This is especially useful for smaller networks to connect to a grid and exchange power locally in an easier manner as it would make it possible for these power distributors to exchange energy on a peer-to-peer basis with the consumers directly. Solar panels and rooftop energy-producing systems are growing rapidly, but they create excess power which often goes wasted or the producers of this energy have to send over the excess energy back to utilities. Using blockchain technology and its easy peer-to-peer exchange would allow neighbors to easily exchange energy among each other rather than sending it back to utilities and waiting for 60-90 days for compensation.

What is a Peer to Peer Network?

The aim of blockchain ledger in the energy industry is to create peer-to-peer-based energy exchange microgrids that would be powered by solar panels in a shared system of energy distribution and exchange. This idea is especially gaining the interest of entrepreneurs wherein several startups have started working on this idea of applying blockchain technology to provide easy energy exchange. The governing factor in this system is that the blockchain technology is so advanced that it can track energy usage and consumption patterns and as such facilitate energy exchanges among individuals thereby reducing the wastage of any excess energy produced by these small systems.  Blockchain technology is also useful for consumers as it makes it easier for customers to change their power suppliers by making procedures such as meter registration quicker and even easier for the consumers. The technology can help in automatically diagnosing network emergencies and reconditioning the reactions to those emergencies, thus, this means that they could also become the base of utilities’ grid-management systems.

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Thus we can conclude that ultimately, the success of blockchain technology, particularly in the sector of energy creation and distribution and grid management could result in a distributed electricity grid, created of small and large systems of power generation that are specially equipped to handle the continuously changing energy needs that we have. This application of blockchain technology can provide a cost-effective solution to the world’s power distribution systems that can prove to be expensive. As such, it would be of greater importance to customers who will save a considerable amount while not having to compromise on their energy needs and will also be able to conserve power that would otherwise go waste. This can be seen as the beginning of an energy system revolution and has as such gained the wide attention of the power industry heavily.