Energetica India Magazine nº88 March-April 2020

POWER SECTOR 46 energetica INDIA- March-April_2020 Utilities Jumping on the Blockchain Train Blockchain technology provides intriguing possibilities on both sides of the dual innovation imperative: overall it provides faster processes, real-time transaction visibility, and reduced costs for digital transactions, which support the optimization of efficiency across the core value chain; and it also offers distinct opportunities for innovating around new processes and services for the future, such as a transactional energy market. Introduction When it comes to technology, blockchain reigned supreme as oneof the most talk- ed about hotspots in 2019. In fact, Deep Analysis recently forecasted that the “total market for Enterprise Blockchain technology sales will grow from $2.9 bil- lion in 2019 to $13.2 billion in 2024.” The report went on to add that “Indus- tries’ interest in blockchain is not about- marginal improvements or a slim go- to-market advantage over their nearest competitor; the interest in blockchain is driven by the potential for revolutionary new approaches that can deliver huge returns on investment.” This certainly appears to be the case in India. Arecent Nasscom report , noted the rapid growth of the blockchain eco- system, adding that the “Indian public sector has driven blockchain-based projects with nearly half the Indian states involved.” When applied in the appropriate places, blockchain holds the promise of trans- forming the ways in which many indus- tries currently do business. It brings re- liability, transparency, and security to a vast range of data exchanges, including financial transactions and peer-to-peer networks, to keep an unalterable record of every exchange, removing the need for trusted, third-party intermediaries in digital transactions.But what does it mean for the complex utility industry? Blockchain in principle and practice Let’s start by setting a little context on the state of the industry. Most utilities are in the midst of a perfect societal, regulatory and technological storm. They are fac- ing increasing environmental pressures, rapidly evolving customer relationships, a growing use of big data technologies in grid operations, changing utility reg- ulations, and intensifying enterprise cy- ber security concerns – all with an aging infrastructure. And amongst all of this change, utilities are also experiencing restricted revenue growth andincreased pressure to grow margins. At the same time, the industry is being disrupted in a dramatic way by digital transformation, new technologies, out- side competitors entering the market, distributed energy resources and more. All of this is culminating in the need for utilities to incorporate innovation into their core business processes (to op- timize efficiency across the core value chain and drive down costs) while also innovating around new processes and services for the future: a dual innovation challenge. And it’s no longer an either/ or option—both types of innovation are essential to sustaining healthy business growth. Blockchain technology provides intrigu- ing possibilities on both sides of the dual innovation imperative: overall it provides faster processes, real-time transaction visibility, and reduced costs for digital transactions, which support the optimi- zation of efficiency across the core value chain; and it also offers distinct oppor- tunities for innovating around new pro- cesses and services for the future, such as a transactional energy market. From complex contracting to transactive energy markets, the potential use cases for blockchain reach far and wide. In the near term, here are three areas that are already starting to show promise: Peer-to-peer (P2P) energy trading and dispatch: P2P trading is by all counts currently the most popular energy blockchain pilot out of the gate, accord- ing World Energy Council research.As P2P pilot projects proliferate, there are Francois Vazille Vice President-JAPAC & EMEA, Utilities Industry, Oracle