Next year Power Ledger will allow people to buy a share in a commercial solar power plant in Australia. According to Power Ledger co-founder and chairman Jemma Green, “That (their new program) will be the world’s first regulated crypto energy offering.”
Building electrical infrastructure isn’t something that most people can invest in directly. The up-front cost to build large-scale generation facilities is well beyond the reach of most people, and there are also numerous regulations that prevent an individual from supporting new forms of greener power generation.
Power Ledger is working to change the way electrical power is created, and giving regular people a way to participate in the global energy game.
Ms. Green explained that, “Presently, it’s quite hard for everyday people to invest in and co-own energy assets,” and continued, “It’s pretty much exclusively the domain of institutional investors.” The new project will allow investors to gain from the power that is sold into the grid, and potentially change how electrical infrastructure is financed in nations that allow this platform to be used.
Power Ledger is Leading the Way
Power Ledger is working on numerous projects that all focus on next-generation energy technology. Over the last decade the price of renewable energy sources like solar and wind have fallen. Depending on the location, solar or wind power can be the cheapest source there is.
Unlike conventional power sources, solar and wind power can be built at a scale that is much smaller than a coal, nuclear or natural gas facility. In theory this is a huge advantage, but in practice, it is challenging for everyone involved.
Traditionally, power has been generated at one large facility and distributed to consumers. Small-scale solar generation flips this dynamic on its head. Today, a residential area can create most of the power it needs without a problem, but monetizing the electricity isn’t straightforward.
Because electrical infrastructure was designed as a one-way street, getting paid for excess generation on a small scale is hard with the current systems.
Building Better Grids
Power Ledger is taking a multi-faceted approach to the next generation of electrical infrastructure. Their new Asset Germination program will take existing power generation facilities and give retail investors the ability to buy a portion of their generating capacity. Later, they plan to expand their reach to new generation projects.
Jemma Green explains that normally financing a large-scale energy project is a lengthy process. To wit, “It’s very time consuming, and there aren’t that many buyers, because it’s a large asset in terms of how it’s packaged,” she continues “But in fractionalizing it into some portions and putting that token on an exchange, that makes the asset more liquid.”
Whatever asset is held via their new blockchain-based architecture would be structured legally as a trust, and managed by a custodian. Blockchain would record all the information, so that investors have a secure record of the energy produced, and money that is collected.
Breaking a Structural Monopoly
The options that exist for electrical consumers have more-or-less been binary. A person can be on-the-grid, or choose to go it alone. In fact, in many countries, mid-scale power generation facilities have to be fed into the national grid on whatever terms the government dictates.
Now small-scale solar installations are changing the game. Programs like Power Ledger’s Asset Germination have the potential to further break the back of the structural power monopoly that governments and the wealthy have held for more than a century.
In addition to allowing small-scale solar generation to supplant the existing power generation model, Power Ledger is enabling smaller investors to enter the power generation market with no middlemen. The results of this shift will take time, but they could define the future of how infrastructure is built and owned.