Blockchain Energy Management System Could Boost Access to Electricity in Africa


Cape Peninsula University of Technology researcher, Thomas Wolfgang Thurner, is urging African countries to implement blockchain technology in the management of off-grid renewable power.

This, he believes, will help increase access to electricity in Africa.

Blockchain energy management off-grid system

In a blog post, Thurner said that Africa is lagging behind when it comes to connecting households to the grid. For example, 15.6% of South Africans are not connected to electricity. This number is disproportionately high in rural South Africa where most residents use kerosene, firewood, and charcoal, which are all carbon-based, to produce energy.

However, Thurner sees distributed ledger technology as the perfect solution to the problem. He argues that the emergence of decentralized systems of energy production could help deliver sustainable energy to rural populations. He explained that a blockchain energy management off-grid system could enable producers to offer electric power that meets consumers’ demands.

Peer-to-peer energy trading

Because a decentralized system brings together multiple players who produce energy, Thurner says that a flexible grid built on the blockchain could help balance supply and demand. This principle is called peer-to-peer energy trading. It is based on an idea that people should be able to buy electricity from households or buildings with installed solar panels that produce more than they use, which creates a micro-grid that allows consumers to bypass government-owned energy providers. Therefore, a blockchain energy management off-grid system can eliminate the need for clearing houses by linking consumers directly with producers.

In South Africa, for example, Eskom acts as a clearinghouse, providing a platform for energy players to manage, supply and sell their power to end consumers.  But with decentralized energy sharing, Africa could do away with such intermediaries.

Shifting towards green energy

There’s a growing need around the world to shift to renewable means of energy production in order to reduce pressure on carbon sources. Renewable sources such as solar and wind power are abundant in Africa and could be harnessed to deliver green energy solutions. This strategy combined with the development of blockchain energy management platforms can allow consumers to easily trade excess energy on off-grid networks that record transactions in real-time.

In addition to peer-to-peer energy trading, Thurner is also proposing that native tokens or cryptocurrency be introduced to enable seamless trading. These tokens will act as a means of exchange through which consumers pay the blockchain platform for the electricity units consumed. The tokens could also be redeemed for vouchers with real money in the economy.

If implemented this way, blockchain will not only end up transforming the trading and billing systems but also deliver green energy solution to rural populations of Africa.

Thurner then concludes by noting that building a trustless ecosystem is essential to enabling a smooth transition to decentralized electricity trading production and trading.

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About the author

Vincent Olago

Vincent Olago

Vincent Olago is the Managing Editor of Ledger Africa and has been active in the blockchain space for three years now. He's passionate about entrepreneurship and the potential of disruptive blockchain technologies to reshape our world. He supports startups to tackle blockchain challenges, address strategic problems and optimize growth.