Switzerland pilots world’s ‘first-of-its-kind’ local electricity market


In Switzerland, Water and Electricity Works Walenstadt has announced the successful completion of the country’s first blockchain-enabled local electricity market.

The pilot, completed in January, was financed by the Swiss Federal Office of Energy to demonstrate how a blockchain-enabled prosumer energy model can be used to optimise grid operations and to provide value to both the utility and the customer.

The one-year project included 37 households in Walenstadt trading locally produced solar energy within their own neighbourhood.

Participants used a blockchain portal on which they could set their own purchase and sales price limits for solar power.

Water and Electricity Works Walenstadt not only provided access to its distribution grid but also purchased surplus solar power and supplied the community with ‘normal’ power when the supply of solar power was insufficient.

Lessons learnt:

  • The community purchase of locally generated solar energy almost doubled.
  • Consumers perceive the electricity market as green, local, and fair.
  • Almost no one wants to pay more.

“The participants frequently adjusted the price limits, especially at the beginning. But the price limit they set for buying local solar power was rarely higher than for normal power from the grid,”

On average, the participants were willing to pay just under 19 centimes/KWh – less than the cost of mains power, which stands at 20.75 centimes. Fewer than 10% of offers were above this rate, despite the fact that many people had declared their willingness to pay more for local solar electricity in the surveys conducted beforehand.

  • Automatic pricing is more effective.
  • Consumer awareness on self-energy generation, purchase and usage management is rising.
  • Large projects like Quartierstrom would require certified and stable smart meters with an integrated application processor that could run different software tools.

Tiefenbeck, leader of the Bits to Energy Lab at ETH Zurich, said: “Quartierstrom was the first project of its kind in the world, and we did pioneering work on many different fronts. We’re especially delighted that the technology operated effectively – apart from the usual teething troubles.” For the Swiss Federal Office of Energy, the application of these new technologies was a particular area of interest.

“The project allowed us to study the extent to which blockchain and artificial intelligence might be suitable for the direct marketing of electricity from decentralized energy sources and what role the energy supplier plays in a bottom-up approach of this kind. These findings should be helpful for the future development of the electricity market,” says Benoît Revaz, Director of the SFOE.