The first “Smart Grid” project in Europe with industrial partners focuses on local energy production and delivery.
A secured local energy marketplace powered by blockchain technology would allow solar energy producers to sell energy directly to nearby consumers.
By reducing the distance energy travels from where it is produced to where it is consumed, clean energy can be provided at a lower cost to consumers.
Paris, October 5, 2017 – The first of its kind in France, the Smart Grid project has the mission to build a blockchain-based local energy marketplace in the city of Lyon. Stratumn was chosen by Bouygues Immobilier, a leading property developer in Europe, to deliver the blockchain infrastructure solution for this initiative. Other partners in this project include Microsoft and Energisme, a Paris-based smart energy consultancy firm. A proof of concept will be presented at Microsoft Experience Days in Paris on October 4th and 5th, in presence of Microsoft CEO, Satya Nadella.
An emerging trend in clean energy, local energy markets offer many benefits. By directly connecting local producers and consumers, they can deliver electricity more efficiently, thus cutting costs. According to the U.S. Energy Information Administration, 6% of energy production in the United States is lost in delivery.
For consumers, leveraging shorter, more efficient delivery routes has a direct impact on reducing energy bills. Olivier Sellès, Group Manager of Research and Development at Bouygues Immobilier, explains: “We want to allow residents of an eco-district to benefit from certified, locally sourced energy, produced by solar panels located in their neighbourhood. Peak electricity usage can often place consumers into higher payment tiers, resulting in a higher monthly bills. By consuming local electricity, homeowners can reduce and stabilize their monthly bills.”
To facilitate a secure and direct marketplace for the exchange of energy credits, Stratumn has delivered a proof of concept that demonstrates how this can be achieved using blockchain technology, cryptography and proof systems. The permissioned blockchain infrastructure implements several validating nodes, each representing an electric utility provider, a regulator tasked with auditing energy consumption and production, and individual solar energy producer-consumers. The blockchain will receive digitally signed data from smart sensors placed on solar panels, and on individual home’s electricity meters.
This approach ensures that the logic needed to exchange energy credits on the marketplace can be transparent and easily audited. By leveraging a consensus mechanism, not one actor or partner can have full control of the system. Rather, the control is decentralized through various protocols. Richard Caetano, CEO of Stratumn, describes how:
“Blockchains offer a way for many actors to participate in a transaction register, where control of the system is secured through proof system protocols. This design resonates with the nature of the Internet. By using blockchains to secure data and processes, we get transparency, traceability and immutability for free.”
He continues by discussing the regulatory advantages to this approach: “Having full system transparency offers us an alternative to the ‘administrative approach’ of implementing regulations. Many rules and regulations can be programmed into the system which ultimately reduce the burden of regulations. Less friction in the market results in more efficiency with less corruption.”
For the Lyon Living Lab project, a “regulatory sandbox” was put in place by the French government to allow producers to sell electricity from their solar panels directly to local consumers. The goal is to learn how the current laws can be translated to support new markets.
There has been much debate in the Blockchain world about real-world applications of the technology. As there is a good deal hype around the technology and only few systems in production, some doubt its viability. Blockchains are theoretically perfect logical systems where each transaction must be repeatable to form consensus. However, in the real world decisions can change, data can be tampered with, and regulations can shift. Richard talks about these challenges:
“Blockchains are deterministic, but the business world is not. We designed the Proof of Process protocol to bridge this fundamental gap between these two worlds. Proof of Process allows us to model the real world in a way that results in a series of cryptographic proofs which can be used as input to blockchain transactions and smart contracts.”
As a proof of concept, this initial project is to demonstrate the connectivity between production and consumption on the blockchain. Plans are being made to deliver a pilot by the end of the year. Olivier Sellès, Group Manager of Research and Development at Bouygues Immobilier, says: “We wish to equip our first building in early 2017 in Lyon, and later in other ecodistricts in France once the pilot project has demonstrated its full potential.”
Founded in 2015 by Richard Caetano, Stephan Florquin, François Dorléans et Sébastien Couture, Stratumn is a PaaS (Platform as a Service) offering which allows enterprise clients to integrate enhanced traceability and timestamping to business processes. The platform leverages blockchain technologies, notably bitcoin, to establish a trusted and auditable timestamp of facts through Trusted Workflows. Based in Paris, Stratumn raised €600,000 in seed funding in February 2016 with Otium Ventures and Ledger CEO, Eric Larchevêque.
Energisme is an energy consultancy firm specializing in four areas of expertise: energy efficiency, IoT, big data and artificial intelligence.
About Bouygues Immobilier
As France’s leading property developer, Bouygues Immobilier develops residential, commercial and retail park projects from 35 branches in France and four subsidiaries elsewhere in Europe. Bouygues Immobilier is committed to continuously improving both the technical and architectural quality of its buildings and customer satisfaction. Bouygues Immobilier is the first developer to be certified ISO 9001 in France and is the only developer to be certified Top Employer France 2016. Since September 2015, Bouygues Immobilier can use the Construction NF Habitat label with HQETM (High Environmental Quality) certification for all its new residential properties.
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