Blockchain and the Energy Sector

In this article, we take a look at some examples of the potential use of blockchain technologies in the energy sector.
4 minute read
By Hugo Briand

The energy sector is undergoing a transformation: since the market was opened up to competition, we are seeing the first 100 per cent online operators emerge. Meters are being installed in homes that provide more accurate monitoring of consumption; and more individuals are becoming producers of renewable energy. But what you may not be aware of is how blockchain technologies are also making a difference; improving current systems while opening up new opportunities.

In this article, we take a look at some examples of the potential use of blockchain technologies in the energy sector. We will try to estimate, on the one hand, whether it is an existing or emerging need, and on the other, if the technology is mature enough to respond to it.


Cryptocurrency mining is a well-known use case: the crypto-currency security mechanism ‘Proof of Labor’ requires a large amount of electrical energy, so as to ensure that the cost of an attack on the network is greater than the potential gain of the network. In order to have enough computing power allocated to securing the network, the ‘miners’ are rewarded by the cryptocurrency network. Many companies were created around this activity which became known as ‘cryptocurrency mining’. Now, in order to reduce energy costs, a number of these companies are favouring renewable energies, capitalising on surplus energy produced in renewable power plants to obtain lower rates.

This can be taken into account in ROI calculations for renewable power plant projects: instead of losing energy produced but not used, it can be used to mine cryptocurrencies and therefore make it a more profitable investment. The market is real for the energy sector, and has been developing over several years.


One challenge of energy consumption is determining and monitoring the source of electricity that is being consumed. In the context of green contracts, for example, this can be problematic: how is it possible to guarantee to the consumer that the energy she consumes comes directly from renewable sources? Two companies, Engie and Ledger are working together on a device that guarantees the source of green energy that is produced by storing it on a blockchain which makes it possible to provide transparency to users.

These traceability capabilities can also be useful for local loops – peer-to-peer power generation networks – allowing users to exchange energy with each other. In addition, they can simplify exchanges between different operators, for example, in the case of sales of resources between countries.

It is already possible to industrialize these projects on a certain scale as shown by the collaborative work of Engie and Ledger, and the need is real for consumers. In addition, the prospects related to traceability are numerous, so this is a topic of particular interest today.

Smart grids

Data accuracy is crucial to enable automated decision-making in smart grids – these projects for optimizing electrical flows through computing – so the subject of traceability alone will encourage the development of intelligent energy distribution capabilities. Coupled with the mining closer to power plants, we have a new capacity to reduce energy losses linked to renewable overproduction. Blockchain technologies, by their ability to transfer value, will also allow the development of local loops while remunerating operators maintaining the electricity grid. These local loops, by their reduced use of the network, make it possible to minimize online losses.

The need is there, and the technical capabilities exist, although they have not all been pooled yet. The first micro-grids projects (local loops) supported by Blockchain technologies are under development, as is the case in Brooklyn. The blockchain advances for smart grids are the sum of the advances allowed on various elements, from the traceability to the local loop, through our next use case: the recovery of anomalies for the networks.


Combined with the Internet of Things (IoT), Blockchain technologies can help set up an intelligent monitoring system, which will reduce intervention time during a failure or even anticipate them. IoT accurately measures the data specific to each device, and Blockchain technologies, through their peer-to-peer protocol, can guarantee the integrity of the transmitted data. Imagine, for example, a hacker connection on a power line with a monitoring system consisting of only one IoT box: if the hacker knows about the case, he will be able to bypass it, or send false information. If we integrate this single box with others so that all the boxes of the network validate the integrity of the data – the same validation model that the Bitcoin nodes validate the blocks built by the minors – the boxes of the other equipment will then be able to reassemble the information that the equipment sends. Erroneous information will be quickly detected.

The scalability problems inherent in Blockchain technologies still make the implementation of this type of system complex, but solutions are beginning to emerge. Projects such as IOTA seek to address issues specific to interactions between Blockchain and IoT.

These are just a few cases of Blockchain technologies being used in the energy sector, there will be many more that are yet to be identified. If you would like to find out more, do not hesitate to contact us.

Hugo Briand
Blockchain Lead & Digital Architect, ekino Paris.
After 10 years of expertise in web applications development, Hugo Briand has been specializing in crypto-currencies, decentralized applications and blockchain technologies for 3 years.