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United States-based clean energy development firm Clearway Energy Group is launching a pilot program for both trading and tracking renewable energy credits (or RECs) on a blockchain, Bloomberg reported on June 28.
As more states are encouraging solar, wind and other green power projects, Clearway Energy Group might take it as an opportunity to expand and upgrade their business with the latest blockchain technology developments.
Blockchain, a decentralized database, has a number of applications when it comes to storing data and keeping it safe. Moreover, it becomes even more transparent, secure and viable across its verified permitted transactions and users. The data that is stored on the blockchain is immutable and hence, can’t be deleted unless certain very rigid conditions are fulfilled. It has been used to track financial transactions, various good, metals, art and crafts and food items including coffee, eggs, etc. Now Clearway has finally come up with another commodity that can be tracked and traded on blockchain and it is renewable energy credits.
Clearway with Ethereum (ETH)-based energy trading startup Power Ledger has started a joint venture to build a blockchain system to both track and trade so-called RECs, Power Ledger told Bloomberg by Email. Power Ledger initially developed blockchain-based energy tracking and trading software that helps the Energy firms to keep track of their RECs. They also help individuals and companies to transact energy, trade environmental commodities and invest in renewables. The company’s peer to peer solar power trading platform is one of the most popular renewable energy trading platforms.
First Blockchain Test in Massachusetts, Then Midwest
According to the report, the solution first will be tested in Massachusetts, generating one to five megawatts of electricity. Power Ledger told the second phase of testing will take place in the Midwest and generate upwards of 20 megawatts.
The report further notes that the U.S. Renewable Energy Credits market is currently worth $3 billion and suggests that transaction costs can add another 3% to 10% to validate them. “While there are effective digital options to trace RECs from when they are generated to when they are retired, costs add up when seeking to aggregate and trade them through brokers or bilateral contracts across state lines,” Power Ledger Executive Chairman Jemma Green said in a telephone interview. The newly developed platform should be more efficient and cost-effective compared to the existing one, she added.
Concluding the matter, Green said that the company has plans to continue the tests for several months and the service is planned for expansion in early 2020.