[Music]
my name is greg mcdonald and this is
brendan Playford hi guys and we're here
to tell you about the the energy
blockchain give you an overview of that
so today we just would love to take the
opportunity to talk to you about a
couple different things first of all we
kind of want to frame the situation of
the state of energy markets today and to
find the opportunity for a new energy
paradigm and and point out how current
public blockchain infrastructure is
generally incompatible with with the
energy infrastructure today and how
we're building a new infrastructure that
will enable that transition and then
give an example of an application that
will run there so energy infrastructure
today was largely designed a long time
ago and a lot of regulation that applies
to it today which disciples the
innovation was put in place about a
hundred years ago and has been lobbied
for to keep in place since then so
there's massive inefficiencies in the
entire ecosystem and infrastructure and
the control and distribution of energy
today is actually quite antiquated and
so there's a lot of regulation that's
preventing us from from implementing a
new system so it's super important that
we work with the current incumbents to
integrate this system and aware of how
your energy what process energy goes
through to get to your home right now
do you even know whether you're a
deregulated space or a regulated space
there are certain states in America
hands up really if anyone fully
understands the process through which
their energy goes to get to them so one
go over here not many people here so the
the infrastructure we have right now is
pretty antic yeah pretty antiquated and
it's set up for a sort of centralized
highly capitalized market system whereby
you generally have monolithic generators
on a network the transmit power directly
to a consumer in Europe that's changed a
little bit with deregulation as in the
u.s. markets where you've got California
New England Texas deregulated which
gives the opportunity for more competent
a little bit more exposure for other
players to come into the market and
offer unique products and really you
know there's there's there's limited
opportunities for new players to come in
there's limited opportunity for new
technologies to be embraced
for example novel gasification we
obviously have a big rush for solar and
wind right now which is being very very
well financed but also a lot of light
small-scale projects yeah basically
energy units that are generated and
intended to be used by a consumer only
10 of those actually get to the end
point and when you do something like a
data center for instance it's closer to
1% so this is actually ridiculously low
and most of that happens because of
inefficient power generation so if we
can localize the power generation and
provide an infrastructure that enables
that and enables the value to be
transferred in that new ecosystem then
we can really increase the yeah and I'm
just gonna add science that really
quickly as well the International Energy
Association by 2050 is planning on
getting 57% of all renewables to kind of
give global supply of energy so 57
percent of the total energy produced
will have to come from in ervil's now an
interesting point to note about that is
when you look at renewables technology a
lot of it is decentralized distributed
power small-scale stuff which doesn't
really have any links to a network right
now so if I've got solar panels on my
house yes that's great I might have a
grid tie I might benefit from a feed-in
tariff but there's a whole host of other
tokenize sort of derivatives you can
take from that model which can unlock a
huge amount of economic abundance from
already distributed systems in order to
coalesce all of these things together we
can do that really well on blockchain so
I'm gonna leave Garrett to talk a bit
more and then I'll come back to those
points what we need to do is create
every single device that's able to
consumer produce energy is connected as
a node and that node is an agent that's
aware of all the other nodes in its
locality and can react dynamically
according to the current market
conditions how much energy is being sold
for weather
what time of day it is whether there's
an abundance of solar power that needs
to be consumed to not flood the market
or flood the power lines and there's
actually quite a difference between
interacting and physical infrastructure
like this and something like finance
where here if you mess up some numbers
then you can actually cause fires and
deaths it's not just a simple rewrite so
it's it's actually very very critical
that the infrastructure is completely
secure and as well which is when you're
looking at how these bits of hardware
infrastructure get financed so obviously
in the interest of the actual utility
operator so the actual generator on the
network to finance that and create a
sustainable way of getting return for
investors on those big capital projects
again going back to the fact that
renewables are generally distributed
systems in order to bring about an
unlock value and create more incentive
for people to either crowdsource or pull
together of resources or small groups of
community investors into I don't know
like a biogas or a wind project in
Africa giving a platform where people
can come together to actually finance
that giving these distributed systems
where at the moment you can take a
renewable energy credit for example for
a small solar installation on your house
and participate in the rock or the rec
market which for small independent
people with solar panels on their house
is not something can do you generally go
through an agent you generally bundle
these wrecks or rocks up into one
package and send them out to auction so
we're looking at creating like a
frictionless way of moving value around
this system and that's moving value not
just of energy it's also ways in which
smaller producers and smaller
participants in the network can benefit
from getting value from what they
already have and I think that's like
that unlocking of value is really
powerful here with what we're looking at
it's gonna get people a much more
frictionless experience and able to do
more with what they've got absolutely so
here's a little demo that one of our
partner companies made a good
singularity that just shows a simulation
of a local energy grid where all where
each section of the network is
today I mcli react to the others and it
just shows an example of pricing and if
you turn off the powerplant how the
house is in that Network react so you
can see that when the power plant is
turned off that the houses will
dynamically adjust their consumption and
production loads and and basically just
react to that so that way in the event
of an actual outage in a real power
plant the houses will be able to still
consume power locally and produce it and
interact with each other and this is
gonna be a huge resiliency improvement
for energy grids all over the world once
this is implemented so of course the
infrastructure today doesn't work very
well for that so we're building a new
one and it's called the energy web
blockchain and we have our test net live
right now and that sets page is live and
we just open sourced it on the 1st of
this month and it's everything's
accessible there we can do 2500
transactions a second right now because
it's proof of authority the authorities
are energy companies that we currently
trust to keep the lights on so we figure
that it's reasonable to trust them also
to validate blocks correctly and right
now it's open network and it will always
be an open network that anybody can use
freely and run applications and transact
value any aetherium smart contract of
course is completely compatible and can
run on the energy of foundation
blockchain and interchange communication
is something that we're very much
prioritizing and we want to have that
coming really soon
so for instance projects like polka-dot
will be very high on our list to
implements that way we can interact with
the etherion public blockchain as well i
think i just want to reflect on a way
that i'm involved in this mix where the
project that we're working on right now
is called the aurora network and what it
is it's an open-source hardware project
where through these mechanisms we're
building we can actually deploy hardware
that's innovative and otherwise wouldn't
find funding so i've got a really good
example biomass gasification
particularly small scale biomass
gasification classically is pretty much
unheard of unless you're on a commercial
scale and when you look at the way in
which going back one more one more yeah
- this - this whole household model here
when you're looking at for example soul
there's a supply demand curve of which
you've got say this massive abundance of
solar energy during the day currently
not sufficiently deployed storage
batteries to take that power offline and
our usage is generally out of whack with
that like we're all at work during the
day the majority of the actual power
consumption isn't until the morning or
the evening you get this dull period and
we're all used to getting cheap
electricity in some regions through the
night you get the economy saving between
like 1 a.m. 7:00 in the morning
that's because big power stations have
to keep running they don't just shut
down because shutting down costs a ton
of money so by implementing this system
whereby you can take energy as and when
it's needed from core parts and
understand what equipment you can bring
online and when so for example in the
time of high demand you have a bit of
equipment that would otherwise cost more
to run or more to cut like produce a
unit of energy that may come on in these
times of high demand and you may have a
variable pricing model for that so that
energy can be used and acquired and sort
of leveled across the network but you're
effectively smooth and this is like a
smart grid effect so all of these
companies are kind of moving towards
this more smart grid and again this
vision of a more distributed power
network this beautifully supports that
when you're actually looking at
tokenizing for example the energy on the
network you need a high transaction
throughput to do that the rate and
volume of which you're planning on
scaling to to make this be a very
impactful global sort of infrastructure
that allows this transfer of value and
flow of markets globally so you can take
abundance in one area and maybe deploy
that in an area where there may not be
the infrastructure or the actual drive
to develop in an african community for
example so California is a great example
California there is an abundance of wall
nutshells that are supplied by walnut
manufacturing companies so where do they
go right now those walnut shells are
dumped or burned there is no value being
created by that by-product so take those
walnuts shells put them through
something like a gasifier on site have a
grid tie tie that back to the network
and actually use that energy in a way
where you can either sell that directly
to a consumer using your tokenized
and link that with more of the smart
meters were seeing like there are these
inductive smart meters where you clamp
them onto your incoming feed of your
house and it will do a Fourier transform
on your frequencies of your energy and
it will tell you after about a month of
learning your fridges using 60% of the
power your toaster is using 0.1%
whatever that mix looks like and if you
analyze that data you can actually start
incentivizing good actors in the system
so I can make an assessment of what the
usage in this house should be if an
actor is overusing that they pay a fee
if an actor is under using and coming
below a threshold they get paid that
back so you're not just the
incentivizing smarter energy
distribution you're incentivizing good
behavior your assent advising better
practice on the network whereby the
participants contribute overall to a
lower demand and that's done in like a
fluid and organic way because everything
is so static right now for instance in
California sometimes their events where
in the middle of the day on a hot summer
day there's a bunch of abundance of
solar power that the market just doesn't
need the rest of the resources are not
flexible so they're not able to ramp
down production fast enough to actually
utilize the solar energy so the utility
companies sometimes ask the solar
producers to turn off their panels so
that way the abundance of of electrons
don't flood the network and so this is
obviously a huge waste and not effective
utilization of our solar industry so
yeah basically enabling the all the
resources on the network to be a lot
more flexible will enable a much higher
utilization of all the electricity we're
generating from renewables especially
especially the ones that vary yeah and I
think this vision as well for the more
IOT connected sort of states so where
you have these feedback mechanisms into
a smart grid where it understands
exactly what to switch on and off when
it's really kind of that utopian vision
of a really efficient marketplace where
you're again going back to allowing a
nice flow of value so when you unlock
value in systems that isn't currently
used
you know our vision is to then use some
of that elsewhere in the world to make
an actual impact so take that station
that's really abundant and producing
revenue and
using a portion of that to develop other
you know other infrastructure elsewhere
invest that in more kind of skunkworks
new development open-source hardware
which does exist out there that
currently isn't getting the attention
because it's hard to monetize hard to
justify costs and encumbers just would
like to continue in the current paradigm
yeah exactly and so the ecosystem within
energy applications that are seeking to
use blockchain infrastructure and some
magnitude is expanding super rapidly
this is a smattering of of companies
that are that are trying to accomplish
this some of them we have agreements
with already and we're working actively
lyft we've spoken with all of them all
of them have shown interest in using
they do have blockchain for the purposes
simply because you can have a lot more
transaction throughput and so on so and
some of them have gone to the point of
purchasing tokens in the energy web
blockchain which are used as gas similar
to ethan ether and aetherium so yeah i
just wanted to say thank you very much
it's a huge honor to be here thanks for
thanks for having us and yeah we do have
a couple more minutes left so if there
any questions we're happy to take those
thanks guys
thanks
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did anyone have any questions if you
don't that's fine if you do it's under
there yeah right so in your presentation
there is a slide where you mentioned
that energy demand fluctuates throughout
the day and that doesn't coincide with
energy that's produced through means
like solar my question is what role do
technologies like in house batteries
think tesla powerwall have in addressing
that specific problem yeah absolutely so
basically the idea is with the tesla
powerwall is if you and if you have an
infrastructure that supports the leasing
of batteries on a short timescale like
for instance over the course of a day
then if there's abundance of solar on
one home for instance if we just go back
to the simulation there's abundance of
power on on this home because they have
a lot of solar panels and only two
batteries and this one doesn't have that
but maybe he has more storage capacity
then basically you can lease out the
battery and use that solar power
throughout the day to power everything
during the night when it's not there so
that way you're shaving the peak a lot
so batteries like that play a tremendous
role and actually utilizing the solar
power more effectively even though you
have a obvious decrease in efficiency
when you store electrons in a battery
you lose some but the gains over just
use lighting and utilizing the normal
grid is tremendous yeah and I think
something I'll add to that as well is
not just to be too narrow in solar is to
also look at a lot of the other
technologies that are out there so in
the UK there is a system called the
Triad Network and what the Triad network
does it is a bunch of distributed diesel
gensets very very big substantial ones
tied to the grid in strategic locations
around the UK between the hours of 6 & 7
p.m. they will switch on they switch on
they provide a very expensive kind of
surcharged power which balances this
load so I think it's about thinking
about how you can also bring on more
novel technologies like you can use
recycled cooking oil that's been
reprocessed in a diesel genset as a
biomass fuel in a strategic location the
infrastructure that costs a little bit
more
but if you are able to switch it on at
the right time of demand and only use it
when demand is high then that can help
balance that though so it's a
combination of storing and finding
dynamic load in the network that can
instinctively switch on based on the
load balancing that's kind of in the
smart grid to bring that power on when
it's needed so you've got this nice
blend of battery which is going to take
some time to kind of get affected on the
network and novel technologies there to
boost it but focusing on renewables for
that yeah there was a really interesting
talk yesterday that treated this as an
optimization problem I guess I'm curious
what the change in efficiency is between
the optimized version and the normal
market if you know sorry in terms of
like yeah thanks yes if you could repeat
yourself I didn't quite hear the between
the witches market and there was a
speaker from Berkeley the other day yeah
who essentially had everyone sort of bid
and schedule stuff and I guess it sounds
like it's sort of a real-time auction so
I think what you're asking are you
asking between the future vision for a
network like this and what we have
currently is it just an optimization
exercise where values coming from
efficiency savings because we have a
little bit more fluidity in the network
is that worst thing anyone else Hey yeah
well thank you for the talk I had a
quick question about distribution
because you talked about production and
also storing at the local nodes sure but
isn't there an issue of a distribution
still being somewhat centralized and
also in waterfall pattern which would
prevent peer-to-peer
send and/or sell energy to my neighbor
kind of thing because there's no
connection there yeah right now the
distribution grid is definitely
centralized and the idea is to work with
them and bring more and more
distribution grid owners on to this
network and then eventually we will to
decentralize the ownership of that of
course that's what we all want we want a
completely decentralized system
but enabling the current incumbents in
the market to start acting with these
technologies and profiting more from
these is the first step to getting them
on board to a really truly decentralized
system so then yeah you're completely
right that it is still centralized in
that there's generally one monopoly in
the state like most of California or a
state like Colorado where one company
often owns the entire distribution grid
so yeah we hope that will change over
time yeah there are physical limitation
by the fact that you can't actually even
send energy from your home so because
there's no so it depends I think we're
saying is so there's we've got
deregulated markets and regulated
markets which will allow generators
access on or off the network and that is
split in two you've obviously got the
generator you've got the transmitter
which is your D&O or your local
operation which is your powerlines you
then got the utility on the end which
you'll retail side of it now what you're
saying is that bit in the middle which
is generally controlled in non
deregulated markets in regulated markets
the likes of Colorado that is something
that if you want to supply it directly
then user you can't if you want to
supply it direct to the energy provider
and they will pay you a pretty poor rate
for that energy then you can also do
that and it's then bundled up in their
package what I think this is going to do
it's going to increase competition in
markets where there is already
deregulation like Europe like the UK
like these particular states in
California and what it needs to be it
needs to be a community effort to
influence and lobby as well through
relationships like energy whoever doing
like bringing together a consortium to
all view this through the lens of this
is the future these companies all want
smart grids they're struggling to
understand how to do that and if you can
place their weaknesses with giving them
sort of power in areas where they
currently don't have it where they have
these deficiencies where they need to
top it up it's all about working
together and understanding where to
start
and like them where to influence to move
forward but I think there will be more
power at least from this in the hands of
the operators that are building
infrastructure like independently than
what they're currently is
I just had a quick question about the
proof of authority chain sure
how are like users expected to pay gas
costs why would they get ether to pay
for the gas costs right now users in the
test network gets handed out for free of
course in the phone network we're still
figuring out the governance principles
and stuff we're not launching the main
Network the Genesis flock will be in the
beginning of 2019 we're still in an
exploratory phase figuring out exactly
the best mechanisms for that but right
now the idea is you you purchase it like
you'd purchase either okay thanks okay
got you great all right well thanks
everybody thanks guys
[Applause]
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