Accelerating Utility Transformation through Blockchain

In today’s world, utilities face the key challenges of fluctuating demand for energy, demand for improved and personalized customer service, increasing operating costs, cybersecurity issues, and meeting regulatory compliance requirements. Utilities across the globe, therefore, seek to change and leave behind their traditional way of running the business and operations. To do so, they are empowering themselves with digital tools and leveraging innovative solutions and enablers. Blockchain can be the key enabler that will address many of these challenges and become the technology of choice for this domain.

The future grid is set to be a two-way system made up of billions of interacting endpoints: everything from smart plugs, smart meters, solar PV systems to digital customer platforms. To enable this enormous, anonymous environment a technology like a blockchain could be a key enabler for these transactions. With this vision, Capgemini has created a framework that uses blockchain to solve some of the common issues that plague this sector.

A contemporary grid has many participants with conflicting interests. The participants can broadly be classified in 4 classes: The grid Operator, the Electricity Suppliers, the Consumers, and the Regulator. The Capgemini framework provides all of these participants with a secure and frictionless platform and defines rules of engagements that help build trust between the participants thus reducing the cost to transact while simplifying the processes.

Let us start with the first participant of this framework, the Grid Operator. The modern grid is becoming more like a marketplace, where there are multiple suppliers, competing to supply to a set of buyers who are becoming more dynamic with the choice of who they buy from, what they buy whether renewable or conventional, what price they buy at, and even the location of the generator. Moreover, some of these buyers could also be suppliers during certain hours of the day. Our Blockchain based solution is helping the operators to create this marketplace and in turn make their business ready to leverage the possibilities of the future.

We now move to the most diverse participant of this framework, the customer. The framework uses blockchain for customer billing, Compensation Management, bill payments and billing related suggestions.

  1. Most contemporary grids have a provision for dynamic pricing to match demand to supply. This results in bills that are higher with no justification, thus reducing customer trust in the Utility company. We solve this problem using Smart contracts for generating itemized bills. This ensures the customer that he is always charged a legit amount while the supplier is fairly reimbursed. The itemized bills are also available if a customer wants to scrutinize.
  2. Analytics on Blockchain linked data allows us to identify patterns of usage and also predict possible improvements in electricity usage which can result in savings for the consumer. These results are shared with the customer in the electricity bill.
  3. Many customers have a compensation clause in their contract with their supplier wherein if the supplier does not meet the service quality provisions, it compensates the customer for the same. Our framework uses smart contracts to monitor the grid and based on the finalized quality conditions generate compensation orders. As Smart contracts are written in programming languages, our framework incorporates an NLP based English to Smart Contract translator which allows these conditions to be written in simple English understood by both the Supplier and the Customer, which can then be deterministically translated to a Smart Contract. This also makes the Smart Contract legally enforceable
  4. The Blockchain is also utilized to offer two types of billing for the customer, the prepaid and the postpaid. In both cases, the framework has provisions for a crypto-token based payments and is extendable to incorporate fiat currency payments as well.
  5. The framework also has an associated Smart Phone App that the customer can use to view and pay bills, view account details and configure a new smart meter to an account based on the QR code.

Regulation agencies participation provides for governance and monitoring of the various stakeholders on the network. The Blockchain based Smart Contracts collect and monitor various parameters like Voltage of Supply, Outage Frequencies, Guaranteed Supply of Service enforcement etc. and compile them in form of standard KPIs. These KPIs are then made available to the regulator while blockchain ensures that they are based on observed data and not influenced by any stakeholder.  There are also provisions to automatically trigger actions in case KPIs are outside of a tolerance range. The actions could include notifications to Regulators or penalties on the Supplier.

The participation of Electricity Suppliers who own customer accounts enables the individual contracts to be moved to the Blockchain. In addition to automating the compensation management for the nonperformance of the supplier, the Blockchain can also audit the income of Supplier from the energy sold both during peak and non-peak times. The framework also allows for crypto-token payments for the Supplier’s services. Based on actual consumption by various customers and by matching that with the contractual provisions, the Supplier Customer Smart contract could levy surcharge. As all energy consumption and supply is monitored by Blockchain, the framework could potentially also be used for detection of Electricity theft.

The architecture of this solution allows it to be adaptable to customer requirements. The pluggable node adaptors and Client adaptors allow for simple integration and quick customization. The entire blockchain network can be deployed in a variety of ways to manage your trust and scalability requirements, with easy addition of new stakeholders. The presence of KYC providers allows for secure and easy integration of customers. All of this ensures that your current system is easily enhanced with new blockchain capabilities in a short time and with little or no changes to your current setup.

The entire framework is scalable to millions of customers. This is achieved through optimal network design and transaction scheduling.

We envisage that in future this system will need to integrate with many other networks some of which would be its peers and others could be ecosystem partners like banking networks etc., for which we have built provisions for Blockchain Internetworking.

We welcome you to get in touch with us and understand how we can help you build trust with your customers, suppliers, regulators, and other stakeholders by applying a Blockchain based delta to your existing system and gain from the disruptions being brought about by this new promising technology.

Rahul Tayal

About

Rahul Tayal is Solutions Architect, specializing in Data Centre and Cloud, Blockchain, Analytics, Security and applications architecture. He has a total experience of 14+ years in diverse areas like Product Design & Development, R&D for Emerging Technologies, and Architecture & Design of Complex IT solutions. As a Blockchain evangelist he is engaged in process transformation using the technology and regularly writes blogs, conducts talks and demonstrations for customers.

More on Rahul Tayal.

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