Centrica, the UK’s biggest energy supplier is testing blockchain technology in an effort to provide cheaper, greener energy to its gas and electricity customers.
As a way to enhance Centrica’s Local Energy Market (LEM), it is planning to use Distributed Ledger Technology (DLT), which is created to provide peer-to-peer trading between its energy consumers. The company, which owns British Gas, has linked with blockchain startup LO3 Energy.
The New York-based company focuses in providing blockchain technology solutions to energy companies and the partnership will witness a distributed ledger system available to members of the LEM; a program that makes it possible for local businesses and consumers to trade flexible energy production to the National Grid and to marketplace participants.
LO3 Energy is an expert in providing data management and blockchain technologies to energy industry participants. Centrica will be using the company’s data platform, Exergy, and will be testing various energy transactions such as peer-to-peer trading. Blockchain technology is used to store and transfer details of transactions, and its associated app can be used by marketplace participants to trade energy at ease.
The company has been active in the energy industry, signing a deal with the European Power Exchange, referred to as EPEX SPOT, to create a platform that will make it possible for participants in France, Germany, the UK, the Netherland, Belgium, Austria, Switzerland, and Luxembourg to trade excess power to one another.
The LEM act a step towards decentralization of the energy industry, so it looks like the right match for blockchain technology, which can additionally decentralize the process.
According to Mark Hanafin, Chief Executive of Centrica Business, “The proliferation of digital technologies is having a significant impact on the energy industry, allowing us to find new and better ways of delivering energy and services to our customers,” before going on to say that it is “an exciting opportunity for us to test blockchain technology beyond the theoretical and put it into practice.”
Centrica is not the first company to try blockchain. The first to complete the UK physical energy trade on the blockchain was London based Verv. Yet, Centrica’s status as the country’s biggest energy company, and its global access will drive the technology closer to the force and give it more mainstream attention.