Solar power and blockchain are new technologies that have emerged with much potential. While solar power is synonymous with renewable and clean energy, blockchain is a type of disruptive distributed ledger technology that has improved financial systems.
But can the two work together? What do they have in common?
Believed to be the next big thing in renewable energy, blockchain technology is adopted by individuals and small businesses to enable peer-to-peer energy trading. This is helping solar power producers to provide energy to consumers in their local communities. Blockchain is also being used to make investment in solar projects more accessible, increasing the amount of solar capacity available for use, including accessories like the Tesla car charger!
In this article, green energy experts at PPM Solar, a Florida Tesla Powerwall company detail the relationship between solar and blockchain technologies and also offer insights on how to choose a solar contractor. Continue reading to learn more!
How does blockchain relate to bitcoin?
A blockchain is a distributed database that maintains a continuously growing list of data records called blocks. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data.
Bitcoin is a digital currency that uses blockchain technology to record transactions. Since its creation in 2008, it has become the world’s most virtual money, and its value has risen from $0.01 to $17,000 per bitcoin today.
The idea behind Bitcoin was that it could replace the role of financial institutions when it comes to tracking and reconciling financial transactions through code and the use of computers all over the globe.
Introducing solar energy exchanges to solve the conventional energy problem
Now that you understand blockchain, you probably are wondering exactly how blockchain and solar work together.
The majority of global energy is mostly generated by large-scale plants. Unfortunately, this necessitates using a grid to transmit power to consumers.
Although this model has been adequate in the past, as increasing numbers of people switch to renewables for their electricity, this one-way system becomes obsolete and calls for a more flexible and effective alternative.
Today, several firms are creating exchanges where people can buy and sell solar using blockchain technology. In other words, solar is generated from multiple sources instead of having a single plant power a whole neighborhood.
This multi-source model of solar blockchain allows people with solar-powered homes to make money and do their part for the environment simultaneously.
What does blockchain do for solar?
The potential for blockchain in the energy sector is huge. Here are just a few reasons why blockchain matters for solar energy.
Bitcoin uses a lot of energy.
Bitcoin mining is an energy-intensive process that uses a lot of electricity. Bitcoin miners use specialized computers to solve complex maths problems, and this process requires a lot of power. According to the most recent figures from Digiconomist, bitcoin mining consumes an estimated 113.03 terawatt each year — comparable to Netherlands’ total annual electricity consumption. Blockchain makes solar energy easily accessible for Bitcoin miners through solar energy exchanges.
Powering bitcoin mining with solar
Solar power plants can be used to power bitcoin mining facilities, which means they could help reduce their energy costs while also lowering their carbon footprint. Also they provide a reliable source of energy that doesn’t rely on fossil fuels or other finite resources, which makes it an ideal solution for businesses involved in bitcoin mining or any other type of crypto production.
Blockchain compensates and tracks solar energy production
Blockchain records every transaction that takes place in the solar energy market by providing a public ledger that is visible to all users.
This makes it easier for both parties involved to complete their transaction since they do not have to wait for other parties or institutions to facilitate their transaction.
Blockchain supports investment in solar projects.
As PV power becomes more and more accessible, it is becoming an attractive prospect for investors. One of the biggest barriers to investing in green energy has been high upfront capital costs and low returns.
However, blockchain can help to reduce those barriers by providing a transparent and secure record of transactions that can be used to track an asset’s value over time.
Blockchain facilitates solar energy transactions and energy purchases
Blockchain technology makes it easy for people to buy and sell solar power in real-time. This means that customers can access a wider range of sellers at competitive prices than they would otherwise pay through traditional channels.
It also helps keep records of the transactions so that both parties can be certain that the terms of the sale were met.
What is a Peer-to-Peer energy trading model?
A peer-to-peer energy trading model allows individuals to trade energy with each other without the need for a third party.
By creating a peer-to-peer network that allows people with excess solar power to trade it, new opportunities arise for homeowners and small businesses who may need help to afford the high prices associated with centralized suppliers and distributors.
Solar and blockchain technologies are two of the most important advancements in the modern world. By connecting them, we can create a more efficient and secure energy system that is both beneficial to the environment and cost-effective.
This will help us move towards a more sustainable future and allow us to make the most of the available resources. While there are still some challenges to be addressed, the potential of this combination is immense and should not be overlooked.