The initiative has been launched by China’s National Development and Reform Commission to promote the construction of “a new power system”.
The Commission, the state body overseeing economic development, is partnering with State Grid Corporation as well as the Southern Power Grid Corporation and the two power trading exchanges in Beijing and Guangzhou to develop a renewable platform and market rules for green energy trading.
In a statement, the Commission points to the several reasons that emerged in its investigations that indicate the time is ripe for the initiative. One is a demand from enterprises, with some indicating a willingness to pay more for green power.
Another is a willingness to build a renewable trading marketplace. Others are the availability of the blockchain technology and the demonstration that trading can be organised.
In addition, there is a consensus on all sides that renewables trading is important both to meet carbon emission targets – peaking before 2030 and neutrality before 2060 – and to integrate the growing penetration of renewable energies that will comprise the majority of the future power system.
“Strong measures must be taken to develop new energy sources”, says a Commission statement.
“We must deepen the reform of power system and make innovation in the system mechanism and market construction. Through the development of green power transactions, there will be a willingness to assume more social responsibility on the part of the user”.
The Commission proposes to launch the pilot in areas where there is strong interest in consuming renewable energies. Once launched it will be expanded to other regions interested in renewable power trading
Aspects that will be investigated in the pilot include the trading organisation, scheduling, settlement and price mechanisms among others to provide services that are user friendly and reflect the full value of the power being traded.
Renewables trading is among the most widely implemented use cases of blockchain in the energy sector, with projects across the globe.
State Grid has previous blockchain experience with projects to the Chinese firm Hyperchain (Hangzhou Qulian Technology) to develop a blockchain IoT deployment solution and another with Wanchain (Guangzhou Wanglu Technology) to develop a data management solution.