Utility Week

UTILITY WEEK | 10TH - 16TH NOVEMBER 2017 | 21 Operations & Assets practice, is blockchain's ability to offer a single shared and secure view of data, right across a network – irrespective of how many parties are transacting in that network. "Consistency is enforced: it's part of how blockchain works," he explains. "Everyone looks at exactly the same data. And that data is immutable. When you store data in a blockchain, no one individual has the power to change it or disrupt it. And that data is distributed rapidly, in real time: once some- thing changes in one node, all the other nodes know of it. With blockchain, the rules are defined, and cannot be changed by any single one of the parties – only by all the par- ties to a transaction, acting together." The result, says Ravindra Balija, Wipro's general manager of digital architecture and technologies for utilities, is to create a differ- ent – and more secure – way for the industry to manage its data. "Utilities' networks are connected eco- systems with multiple data exchanges and 'hand-offs' to multiple parties, calling for significant amounts of investment, and high costs in terms of reconciliation, verification, and validation," he notes. "Blockchain fun- damentally disrupts this, providing – liter- ally – one version of the truth. So it becomes possible to do things that otherwise can't be done today, such as make agreed financial settlements in near real time. Power can be generated, and paid for immediately: there isn't any need to wait for data, and to then reconcile and validate that data. The funda- mental process of validating all that data is being disrupted, and potentially eliminated." So what, then, might blockchain look like in practice within the utility industry? In the energy sector, Balija points to the huge surge in the number of end-point solar and wind "prosumers" as an ideal application. "These vastly complicate the data flows involved, with end points that are not just consuming energy, but feeding it back into the grid as well," he says. "Blockchain not only makes it all simpler and cheaper to manage this, but also opens up the possibil- ity of peer-to-peer energy trading." Supplier switching is another fruitful area for blockchain, he adds. "At the moment, switching is a slow and complicated pro- cess, and this is generally down to the need to co-ordinate all the data transfers that are involved – getting everyone to the same point, and agreeing the cut-off point at which one supplier ceases to be the provider, and another takes over. With blockchain, all of this is again easier, simpler, and cheaper, because the blockchain ledger has all the data. In the UK, switching can take up to 21 days at present: with blockchain, it is possi- ble to do it in a few hours." Grid management, smart contracts, demand response management, trading platforms, asset tracking: in all these areas, adds Ram, blockchain can have a disruptive effect, rewriting the rules of the possible. Faster data, better data, pre-validated data, and more robust data: blockchain, reck- ons Wipro, offers not just a better and more secure way of transacting, but also a way that offers savings compared with existing approaches. Even so, as with using blockchain to help manage the two-way data flows entailed with prosumers' wind and solar-generated power, the adoption of a new technology such as blockchain will always be easier when not only is there a need, but also an absence of an extensive existing infrastructure that must be expensively discarded before the end of its useful life. Consider the rapid rollout of mobile telephony across the Middle East and Africa: in both cases, landline technology was largely leapfrogged, with providers and users jumping straight to mobile connectivity. Will history repeat itself? Technology pro- viders such as Wipro clearly hope so, with Wipro's Ram pointing to blockchain's low costs of adoption acting as a democratising influence within the sector, lowering barriers to entry and increasing competition – mes- sages doubtless of interest to regulators. Others, however, counsel caution. Navi- gant's Ravens, for instance, while bullish on blockchain in general, sees adoption taking place at a more measured pace. "Blockchain is an interesting technol- ogy, but it's going to take a long time for it to really become embedded in the energy industry," he says. "What is really needed for blockchain to take off is a really sophisti- cated market for prosumers – and that might be a decade away." Block chain in action: Motionwerk Think "charging station" and it's difficult to shake off the mindset of the fossil fuel era in which "charging" or fuelling stations are oper- ated by large companies, or perhaps munici- palities, with charging being paid for by cash, or credit or debit card. But the reality of electric vehicle charging is very different. Charging points are unattended, with no physical person there to pay or transact with. And the owner of the charging point may not even be a corporate entity, but someone who has bought an electric car and installed a charging point outside their house. Ravindra Balija, Wipro's general manager of digital architecture and technologies for utilities, says private citizens need to have access to a charging point for only a few hours every day – and having invested in having one installed, have every incentive to defray that cost by making it available to friends and neigh- bours when they don't require it themselves. "They're out at work, say, and the charging point is sitting there unused and potentially available for use: the trouble is, there's no straightforward way for ordinary consumers to carry out such a transaction. Or even of finding an unoccupied charging station, without physi- cally seeing it." Back in early 2014, German energy utility Innogy SE began thinking about this very problem, and conceived of blockchain as the answer. Today, it has a series of blockchain- enabled products, including a blockchain- based peer-to-peer car-sharing smartphone app, a pan-European charging infrastructure employing blockchain as a payment mecha- nism, and a peer-to-peer charging station network in California. Using a smartphone app, drivers can not only find an unoccupied charg- ing station, but also reserve it and pay for it. "It was a very futuristic vision," explains Carsten Stocker, senior manager for the machine economy at Innogy SE. "We wanted to invent Uber for energy, blending our own technology with that of others." That blockchain became part of that solu- tion was coincidental, he concedes. But talking to both start-ups and major IT service providers – including Wipro – it was clear that blockchain was theoretically capable of meeting Innogy's needs, and was worth investi- gating. In particular, he says, the company was pointed to the block- chain-based digital cur- rency Ethereum, a competitor to bitcoin. Very quickly, he explains, Innogy decided to partner with Ethereum and use its existing "open" blockchain technology, rather than develop its own proprietary blockchain, seeing the value of using a digital currency that had already gained traction and an active user base. "We wanted to invent Uber for energy." CARSTEN STOCKER In 2015, Wipro partnered with Utility Week to establish the Technology and Innovation Council, which aims to foster collaboration across the sector. For information about the Council and its activities, contact Elaine Munn: elaine.munn@ utilityweek.co.uk

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