Figure 1. A trial between Power Ledger and BCPG in Bangkok’s T77 precinct marked a first for P2P energy trading in Asia.
Blockchain technology, with baked-in provenance, security, tradability, and real-time payments, intends to help make RECs a vibrant, attractive investment opportunity instead of the slow, complex instrument they are now. Automation will replace the current cumbersome process of paperwork and reporting to prove that assets and people have sold a certain amount of clean energy. Automation will also support existing compliance processes, ensuring that RECs cannot be resold after they have been retired or that the same REC cannot be sold twice. More importantly for asset owners, minting tokenised RECs in real-time using data provided by smart meters will also ensure that money is not being left on the table – that is, enough RECs are being claimed by the clean energy generator. Everyone loves getting paid in real-time. Imagine a co-op wind farm selling energy and generating micro-RECs in the process. As these micro-RECs are tokenised and deposited into the co-op blockchain wallet, they can immediately be put on the token market to trade 24/7 and begin generating continuous income – another benefit for renewable energy developers. The immediacy of payment alone can incentivise more people to invest in renewables. Picture entire communities
40 ENERGY GLOBAL SUMMER 2020
with household solar participating in a REC market; not a separate scheme for small installations and another scheme for large renewable assets, but the creation of a single, unified scheme for large and small solar farms alike. It is about creating an auditable, transparent marketplace connecting buyers and sellers. Or perhaps some intermediaries, such as REC aggregators that represent both buyers and sellers, will continue to be involved. The automation of their current processes will free them up to provide a premium service to large buyers and sellers, much like the services stockbrokers provide to wealthy individuals who prefer not to place their own buy-and-sell trades and instead trade via a trusted intermediary. In any case, a marketplace for tokenised RECs serves both sides of the market – those who want to place their own buyand-sell orders and those who want to on-board their existing buyers and sellers and offer a premium aggregator service.
So, what is holding up this RECs trading Utopia? Currently, renewable assets must engage an aggregator to handle the entire process of REC sales, though it is the asset owner’s responsibility to ensure all eligibility criteria are met.
