UK energy company Centrica has announced a trial to explore how blockchain technology could revolutionise the way consumers buy and sell energy.
The project will look at how blockchain could enable 200 homes and businesses to cut their energy costs by providing a secure platform for consumers to buy and sell from each other.
Blockchain groups buy and sell transactions together into blocks that are securely linked so that the trade history is permanent and unalterable, the company said.
Centrica is partnering with US energy blockchain specialist LO3 Energy to roll out the technology as part of Centrica’s local energy market project in Cornwall.
Last year, Centrica Innovations invested in LO3 as part of a £100m programme to identify, incubate and accelerate disruptive new technologies.
Mark Hanafin, chief executive of Centrica Business, commented: “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.
“This is an exciting opportunity for us to test blockchain technology beyond the theoretical and put it into practice, developing innovative new solutions that will empower consumers in the UK, North America and beyond to take control of how they engage with energy.”
Centrica is also working with LO3 on a trial in Texas of what it said would be the world’s first micro-hedging market for business customers.
Unlike the traditional model where businesses manage their electricity procurement through fixed price contracts, or power purchase agreements, the new project will use LO3’s platform to offer large commercial and industrial companies the opportunity to place their own orders for customised power hedges that are then matched with the best offer in a competitive system.