Centrica trials blockchain energy trading for local market cleantechnica electricity pictures

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Centrica and LO3 have collaborated to put together a local energy market trial in Cornwall, England. Blockchain technology will be used to create a peer-to-peer energy trading platform. Solar power and energy storage will also be integrated into the local energy trading system. Emily Highmore-Talbot, Centrica’s Head of Communications (Business and Innovation), answered some questions about the project for CleanTechnica.

It’s still very early days but the idea is that a peer-to-peer energy market will offer the customer an alternative to buying all their energy through their supplier. Participants will be able to buy and/or sell energy within the local energy market, connecting homes and businesses who have their own on-site generation capability with other customers who would prefer to buy their energy from someone local.

The trial is taking place as part of a broader Local Energy Market trial in Cornwall, which is being designed to reward participants for being more flexible with their energy use. The details are still being worked on but an example could be that a homeowner might receive a credit on their bill or a payment direct from the LEM. On the business side, we would expect to see improvements in operational efficiency that would result in a financial upside.

We intend to recruit 200 homes and businesses to take part in the trial, a good number of whom will likely already be involved in the wider Cornwall Local Energy Market programme, which comprises around 100 homes + 50 businesses. We’ve had applications in from over 300 potential domestic participants and are about to embark on technical surveys to identify which 100 we will be taking forward in the trial.

On businesses, we aim to work with around 50/60 businesses including both industrial & commercial customers, and renewable generators, and have a total funding pot of £8.6m available to support businesses who want to be part of the programme.

Some of the homes already have solar panels installed – we will be covering the cost of installing solar PV in all those that don’t currently have it and will also be installing battery storage to complement the solar panels so all domestic participants have solar generation and storage capability.

In time, the blockchain trial will be baked into the Local Energy Market programme. As part of the programme, we are developing a first of its kind market platform that will enable participants to put bids in to either buy or sell energy, much like our own team of energy traders.

The platform is currently going through a Beta-testing phase with the aim of launching the first flexibility trials at the beginning of June. This will see the local distribution network operator (Western Power Distribution – WPD) bidding to buy flexibility from participants.

Cornwall has made extraordinary strides in terms of their take up of renewable generation but that has brought challenges in terms of network capacity. This means that the network has a queue of renewable generation programmes with high associated grid connection costs.

The local distribution network operator, Western Power Distribution (WPD), is actually one of our partners on the trial. WPD hold responsibility for maintaining the electricity grid and managing the delicate balance of supply and demand across the region. This trial is an opportunity to see how we can support WPD and other network operators by relieving pressure on the grid through the deployment of distributed generation and storage.

We’ll also be looking at how many MW of clean energy we’ve been able to bring to the system, where we’ve been able to avoid constraints on the system that might have otherwise resulted in constraint payments being made to operators, how many businesses we’ve been able to help etc.

This is an R&D project and early days but we believe that the Cornwall Local Energy Market and associated blockchain trial is an exciting opportunity to demonstrate the opportunity for local energy markets in the UK and beyond to both relieve pressure on the grid network, support future decarbonisation and give customers at home and in business greater control over their energy use.

Earlier this year we announced that we will be working with the Carbis Bay Hotel & Estate where we will be installing two new combined heat and power (CHP) units to help supply their £15m beachside regeneration project comprising accommodation, a restaurant and event space.

Another example is The Olde House working farm and holiday retreat near Wadebridge where we have worked with redT energy to install a series of 1MWh energy storage machines (flow batteries) that will help the site to better manage the power they generate from a 250KW solar array.