Blockchain: a key tool in the fight against climate change

September 19, 2019 | Nicole Anderson

Climate change is unquestionably the biggest challenge of the next decade. While lifestyle changes will play a core role in reducing emissions, a recent report describes how blockchain technology may be able to help that process by transforming our energy markets and turning consumers into producers.

Climate change can largely be seen as a result of industrialisation and the relentless advance of technology. However, what we often miss is that it is also the result of a package of human behaviours and habits that have arisen hand-in-hand with the availability of cheap, plentiful energy.

Technology has facilitated those lifestyle changes. Now, a report by the International Renewable Energy Agency (IRENA) highlights the role that key technologies such as blockchain might have in altering markets and behaviours to combat the threat of climate change.

Blockchain Innovation

The report catalogues some of the major players in the energy industry who are actively researching and deploying blockchain solutions, including the UK’s National Grid, E.O.N and a raft of other utility companies, private enterprises and start-ups. Overall, almost $500 million has been invested in blockchain power companies, with $300 million raised by start-ups in 2017 alone to apply blockchain technology to the power sector.

There is good reason for this investment and interest: blockchain offers much to the energy industry. IRENA’s report details a large number of possible applications, from grid management and system operation to administration of renewable energy certificates and financing renewable energy development. But one of the earliest and most promising applications – and one which already has its first customers – arises from blockchain’s support for peer-to-peer micro-transactions. It is this ability to move small amounts of money very efficiently, directly between users, that makes blockchain such a powerful means of incentivising a Low Carbon Economy.


The private sector has proven enthusiastic in identifying new business opportunities in the energy sector, enabled by the application of blockchain. With decentralised technologies comes the possibility of decentralising energy production: moving away from a top-down model of a handful of huge power stations dotted around the country, to one of many smaller, local ones – including at the household level. This approach carries inherent advantages; not only is it inefficient to move electricity long distances (roughly 8 percent is lost between power station and plug), but a decentralised approach makes for a more robust system less prone to outages (such as the recent blackout in the UK that affected almost a million people).

Perhaps most importantly, this involves households becoming micro-generators of electricity through solar and wind technologies – turning consumers into producers, or ‘prosumers’. Surplus electricity can be distributed to other households in the immediate area, with the blockchain hosting an efficient marketplace for energy. This gives households a stake in their national infrastructure and a reason to become net producers of power.


Once such company building out infrastructure to support this new paradigm is, a blockchain-based cloud marketplace for the monetisation of resources. Its peer-to-peer protocol allows individuals and enterprises to exchange trade resources securely without any central authority. One of its longest running partners is Stimergy, the green data center supplier. Stimergy install mini-data centers into residential buildings and the excess thermal energy is then recycled into the building. By interconnecting all its data furnaces via optical fiber, Stimergy has established a decentralised datacentre, with no energy impact to society.

Founded in 2013 by Christophe Perron, Stimergy has been awarded multiple times for the invention of the ‘digital furnace’. Its partnership with iExec opens it up to new markets. iExec is also host to EDF, the fifth biggest utility company in the world who use its technology to trade data. Check out the marketplace at

The Brooklyn Microgrid is another initiative supporting the emergence of the prosumer, started in 2015 by LO3 Energy. Households with solar power who wish to sell their excess energy will no longer have to sell it back to the grid thanks to blockchain-based platform Exergy. The peer-to-peer trade of energy can take place securely between residents offering an alternative to monopolistic utilities companies.

One thing is for sure: the energy market of the future is looking very different from the model that has been in place for over 140 years.

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