The Future Of Secure Data - Blockchain, Energy & Sustainability
For all human history, people have exchanged goods and services through marketplaces, corporations and an assortment of intermediaries. Market middlemen operate in every industry: Uber for taxi drivers, Amazon and eBay for manufacturers, real estate agents for property buyers and sellers.
Blockchain technology will fundamentally alter this process by replacing the current trust system, intermediaries, with a secure, software-based system. Blockchains will revolutionise many industries, the first of which is likely to be international money transfers.
Transactions will be instantaneous, fees will be almost non-existent, and you can transfer money at any time. Individuals won't have to wait for approval to open an account, meaning people in poorer countries can more easily support their families from overseas.
Conventional wisdom and prevailing media sentiment have been that workers and labourers could face automation in the coming decades. However, blockchain technology could first render the middlemen of our world economy obsolete. By allowing peer to peer transactions through decentralised databases and smart contracts, individuals could interact with one another unrestrained by intermediaries.
As Vitalik Buterin, founder of Ethereum states:
Whereas most technologies tend to automate workers on the periphery doing menial tasks, blockchains automate away the center. Instead of putting the taxi driver out of a job, blockchain puts Uber out of a job and lets the taxi drivers work with the customer directly.
People have expressed reasonable doubts over blockchains implementation and security. Often there are concerns over uncertainty; from whom am I buying? Blockchains immutably store any piece of information about anyone from any source. Users control what they choose to reveal through the blockchain. You can selectively disclose information about yourself that will allow you to trade with another person. You can choose who to deal with based on the information they choose to disclose.
A second concern is transparency. It is often difficult to track how a product evolves from raw materials in one area, manufactured into parts in a different place and finally assembled into a final product in yet another place, all by various businesses. This opaqueness makes tracking companies’ environmental records difficult. A shared database distributed across multiple companies allows purchasers and those in the supply chain to track every product's origin accurately, as well as any waste.
Another concern people may have relates to contract fulfilment; what happens if the other party doesn't hold up their end of the deal. Blockchain technology allows for guaranteed contracts without a third party, with money held in escrow. You do not have to release the funds until you are satisfied that the other party has met the contract conditions.
Exciting emerging uses
Some of the most exciting future developments for blockchain technology are in the energy industry. Currently, energy supply is centrally managed and regularly has to travel long distances between suppliers and users. Many people are unaware of the source of their energy. Users cannot buy directly through each other. Instead, they must use intermediaries like the public grid or a private company.
A blockchain-based energy marketplace would allow individuals and smaller producers to utilise solar panels or other renewable sources for profit. They could sell power to each other for a fraction of the cost of buying it from a supplier. A peer to peer energy supply would allow an individual to sell the excess energy supply harnessed by their solar panels to their neighbours, family or friends. Local energy marketplaces would reduce wastage and the use of long-distance transportation of energy, as well as give people without solar panels a way to access renewable energy
The maiden peer to peer energy trade happened in Brooklyn in 2016 using the Ethereum blockchain, with an individual selling a few kilowatts to his neighbour. Since then, startups have been launched with the goal of providing the world's first peer to peer energy marketplace.
One company is Power Ledger, who has recently built a peer to peer energy platform in Australia. The platform allows users to sell their renewable generated power instantly with others living locally. Long term, the organisation aims to give consumers more choice over the energy they use while storing all transactions on the blockchain for security.
The impact of blockchain technology in the energy sector could prove to be its most promising sustainable use.
How will blockchain technology impact sustainability
The World Economic Forum released a report titled "Building block(chain)s for a better planet," focusing on using blockchain technology for sustainable causes worldwide. They found that decentralised resource management could transform carbon and other environmental markets through transparent supply chains. They write, "Our research and analysis identified more than 65 existing and emerging blockchain use-cases for the environment".
Mankind has worst damaged the environment through the use of fossil fuels. It's good news then that the industry that stands to change significantly from blockchain technology is the energy industry.
Since 2018, implementation of blockchain technology in the energy sector has come a long way. According to a report by Wood Mackenzie, a global energy research and consultancy group, a majority of blockchain-based energy projects are building peer to peer energy markets. These projects could promote a more comprehensive domestic implementation of solar and other renewable energy production. Individuals could sell their excess energy to each other without the need for an intermediary. Additionally, the solution is scalable and could provide affordable energy to people in impoverished parts of the world.
As blockchain technology can swiftly track the source of materials, purchasers can hold companies to account and score them on their environmental impact. A public, distributed database creates transparency in an opaque part of many businesses supply chains. The general public could effortlessly hold to account any company that backpedals on their sustainability promises.
Jack Ma, Bill Gates and many other thought leaders have spoken in support of blockchain technologies future implementation worldwide. Blockchain technology has the potential to revolutionise many more industries and empower true ecosystems.