Japan’s TAKE Energy Corporation (TEC) has partnered with the Singaporean blockchain start-up Electrify to use their electricity marketplace platform, Synergy, in Japan’s Kyushu region.
Synergy is a P2P electricity marketplace which can allow small-scale producers and consumers to buy and sell power.
How does it work?
Electrify issued the ELEC token, using the Ethereum blockchain, to fuel the system.
Electricity producers, both retail and small scale, make a deposit in ELEC to connect them to the marketplace and the power grid. Electrify expects deposits will encourage long-term ownership and discourage bad behavior.
Producers publish their electricity data on Synergy. Hence consumers can compare prices and select the best deal for them.
While producers pay their transaction fees in ELEC, consumers can pay producers in ELEC or fiat currencies using their eWallet.
What allows this to happen is Electrify’s “PowerPod” IoT device. This keeps track of producer electricity data and uploads it to the blockchain for consumer benefit.
The PowerPod, while mandatory for producers, is an optional extra for consumers who wish to keep track of their electricity usage.
The Advantages of Blockchain
Electrify’s system has a few benefits over current ones:
1) Real-Time Settlement – Whereas users currently pay electricity bills after using the power, blockchain allows for real-time transactions. This means producers can be confident that they will receive payment and consumers are assured they don’t pre-pay, face supply issues down the road, or overpay.
2) Low barriers to entry – The current system has no way to incorporate small-scale producers who generate excess power. Synergy allows these people to relatively easily get on the market and sell their electricity.
3) Cuts out middle-men – Because smart contracts can execute the transactions, middlemen and their high fees are no longer necessary, lowering costs for consumers and producers.
The TEC partnership
This is all well and good but to work, Electrify needs a power grid connection. That’s what TEC offers.
“Electrify has progressed very significantly in the development of their blockchain platform,” said Kazuma Takemoto, CEO of TEC. “We are very keen to work with Electrify to realize P2P energy trading in Kyushu.”
Part of the deal is that TEC will install PowerPods in their own systems and also at their subsidiary Kumamoto Electric Power’s solar farm.
This represents a massive step for Electrify and their platform, which could potentially cater to 8 million people.
In April the startup inked a deal with TEPCO, Japan’s largest utility company. With the two agreements, the company has two out of eight Japanese regions covered including Tokyo.
But that doesn’t mean Electrify is ready to launch tomorrow. Last month the organization completed the proof of concept, and the company is currently working on its ‘Alpha’ version of the software. So there’s still a little way to go.