Kyocera Corporation and LO3 Energy recently announced a joint project to test the potential of running a blockchain based virtual power plant (VPP), a network of decentralized medium-scale power generating units.
The test started on 28th Feb 2019 at Kyocera’s Yokohama Nakayama office in Japan, where a small VPP has been installed using the firm’s solar panels and batteries. LO3 Energy’s blockchain technology will be used to record, verify and manage flows of energy and their related transactions. This should enable Kyocera to ‘share’ the power that they produce with their solar panels through a mini energy grid, reducing the burden carried by the larger energy grid.
Kyocera’s interest in blockchain
Before the March 2011 Fukushima earthquake, almost 30% of Japan’s electricity was nuclear. By March 2012 all functioning nuclear power plants were taken offline for years before being reinstated in 2015 in the face of strong consumer opposition. During the 2012 – 2015 period, the shortfall was made up by using fossil fuels.
The result of the earthquake was a major electricity reform program with the market opening to retail competition in April 2016. The final phase of separating electricity generation and transmission will happen in April 2020.
Renewables are a significant part of the government’s energy portfolio plans in Japan, where a research initiative to create new smart energy networks is advancing. Kyocera has been providing the government with power generating systems and storage batteries for their VPP test projects, helping the company gain expertise in remotely controlled distributed power resources.
Using this expertise and LO3 blockchain technology, both companies will test VPPs that promote a low-carbon society.
Lawrence Orsini, CEO of L03 Energy, commented on the potential impact of the startup’s partnership with Kyocera: “Using distributed ledger technologies, our networks enable the micro energy transactions needed to meet this challenge [reducing carbon emissions]. We believe the synergies between Kyocera and LO3 Energy will produce a new generation of virtual power plants that can accelerate Japan’s transition to a low-carbon society.”
Other Japanese energy initiatives
The Japanese market has seen several energy blockchain projects. Two weeks ago LO3 announced a test with another Japanese company, the Marubeni conglomerate.
Late last year a consortium involving Kansai Electric Power, Unisys, University of Tokyo and Mitsubishi UFJ Bank announced a prosumer electricity trading system built on blockchain.
In January Fujitsu said it is using blockchain for a system where consumers control the amount of energy they use in peak periods.
And in the middle of last year, Japan’s TAKE Energy Corporation (TEC) partnered with the Singaporean blockchain start-up Electrify.