Shell Subsidiary Builds DLT-Based Virtual Power Plant in Germany

Amid a wind-down on coal and nuclear energy production in Germany, blockchain technology is being used to construct decentralized networks of clean energy producers.

Royal Dutch Shell subsidiary Sonnen Group announced a partnership with the Energy Web Foundation (EWF) to use EWF’s blockchain to create a virtual power plant (VPP) in Germany on March 12.

The virtual power plant will comprise a distributed network of residential energy storage systems intended to absorb excess wind power and reduce Germany’s renewable energy curtailment. 

With Germany shutting down coal-fired and nuclear energy plants in the coming years, the country has seen a boom in renewable energy production as a myriad of green energy producers launch or expand operations to meet demand.

However, the seasonal nature of both power and production and electricity demand has led to a glut of renewable wastage. During 2018, Germany curtailed 5.4 terra-watt hours (TWh) of renewable energy in total, while in just the first quarter of 2019, Germany curtailed 3.2 TWh of wind energy.

VPP to absorb excess wind power

Sonnen’s VPP will support its regional power grid by absorbing excess wind energy stored across a network of the company’s proprietary “Sonnenbatteries” — which are networked using distributed ledger technology to form the new virtual power plant.

Transactions between the grid and Sonnen are executed through smart contracts, with transaction fees processed in the form of the Dai (DAI) stablecoin.

Through averting an overload to the power grid, the blockchain-based VPP hopes to facilitate further expansion of Germany’s renewable energy production.

The new VPP is Sonnen’s third to launch in Germany

Energy Web Foundation CTO Micha Roon said the use of “a blockchain-based approach to reduce curtailment from large-scale wind energy by leveraging the available capacity of distributed batteries” is a “vision of the future.” 

Jean-Baptiste Cornefert, the managing director of Sonnen eServices, stated that “virtual power plants such as those from Sonnen are the technical building block for this power grid that has been missing up to now and can help to ensure that less green energy is lost,” adding:

“With a flexibility market for renewable energies and the automatic exchange of supply and demand, we are realizing the next step towards a smart grid that can deal much more flexibly with fluctuations from renewable energy.”

Clean energy producers embrace blockchain in Germany

With Germany’s power sector rapidly changing, an increasing number of clean energy producers are exploring blockchain-based technologies.

On March 9, blockchain technology provider Unibright (UBT) announced it had partnered with German energy startup Wasserkraft Mittelrhein to build a decentralized network of electricity-generating buoys built using the Unibright Framework.

Wasserkraft’s “power-buoys” are more than 36 feet long and weigh over seven tons. Each buoy generate enough electricity to power 100 households for a year. 

The project is expected to see the installation of 16 power-buoys in total.