WePower is transforming the renewable energy market in Estonia
Estonia, a small Baltic country, relies heavily on fossil fuels for its energy needs, with only 18 per cent of its energy coming from renewables. However, WePower, a blockchain-based energy trading platform, is aiming to change that.
The CEO of WePower, Nick Martyniuk, stated that the company’s main focus is to test the limits of what’s possible with blockchain technology while also working to increase the percentage of electricity generated from renewable sources. Martyniuk also highlighted the fact that the cost of renewables has decreased significantly, but small to medium-size companies still lack a good way to purchase green energy.
To address this issue, WePower has made energy data available and enabled people to share their energy meter data with service providers. This has been made possible in Estonia, a country with 100 per cent smart meter coverage, according to Georg Rute, Elering’s digitalisation development manager.
Blockchain technology has played a crucial role in this transformation, providing the necessary trust for data sharing and creating liquidity and accountability between energy buyers and producers, as explained by Martyniuk. This has made it easier for people to trade on WePower’s renewable energy trading platform, which connects energy buyers directly with energy producers, allowing individuals and companies to decide which green energy project to purchase from.
While blockchain technology has the potential to be used for any type of energy transactions, WePower has specifically focused on renewables, aiming to connect the grid, local energy exchange markets, and end users of energy. Stephen Woodhouse, the chief digital officer at Pöyry, an international consulting company that focuses on energy, industry, and infrastructure, mentioned that WePower’s cryptocurrency and tokenisation approach offers an alternative to traditional renewable energy power purchase agreements.
However, scaling up the project may pose challenges, particularly in terms of transaction capacity. WePower mainly uses the public ethereum blockchain with the proof-of-work approach, which requires a significant amount of energy and computing power. Fei Wang, senior research analyst at Wood Mackenzie, an energy research and consultancy firm, sees this as a potential hurdle if the project expands to a full commercial deployment.
Despite these challenges, WePower’s trial in Estonia is a significant step towards understanding the potential of blockchain technology in revolutionizing the energy market. If successful, this project could pave the way for a larger-scale implementation, potentially creating an energy exchange or facilitating peer-to-peer trading.