Another utility is jumping on the blockchain bandwagon.
Illinois electric utility ComEd is partnering with a California developer called Xage to test how its blockchain-based software might help the utility manage an increasingly complex distribution grid.
As customer-owned solar and storage becomes more common, electricity is more often flowing in multiple directions. Utilities are looking for better ways to securely track and verify how electrons are moving around on the system.
The information will be critical to ensure owners of distributed resources are fairly compensated and can exchange energy securely with other resources on the grid.
Blockchain is often described as a digital ledger, which can track transactions — in this case, exchanges of energy — using secure, encrypted data. As more customer-managed resources interconnect to the grid, they open more points of vulnerability for hackers to interfere, making security a major focus for utilities.
ComEd’s project is based in its Grid of the Future lab, where engineers can test the reliability and simulate its use on the grid before trying it in the field. Project leaders want to learn how effective the software is in securing and tracking energy exchanges.
In this case, tests simulate exchanges between distributed energy resources — things like solar panels and batteries — within two microgrids in the utility’s territory. Xage’s software is an added layer to ComEd’s microgrid controller, which acts as a central manager of the resources (mainly solar, storage and controllable generation) on the utility’s microgrid in the Bronzeville neighborhood on Chicago’s South Side. That microgrid is “clustered” with the nearby Illinois Institute of Technology’s microgrid, meaning they can exchange energy.
The project is “part of exploring for the distribution network,” said Calvin Zhang, manager of emerging technology at ComEd, noting that if this project is successful, it will benefit more than just the microgrids it’s being tested on. Customers are increasingly interested in connecting their own solar panels and batteries to the grid, Zhang said, and as these resources become more common, they’ll need a secure platform that can track their interactions with utility infrastructure.
The first step for ComEd’s engineers was to test the Xage software’s authentication capabilities to verify it works securely, Zhang said. Now they’re examining its ability to facilitate secure energy exchanges between two microgrids, which Zhang said could help improve the efficiency of the microgrid cluster in ComEd’s territory.
“The focus of our engagement with ComEd is really enabling their exploration into the clean energy space, into enabling distributed energy resources, into enabling community-based energy production and consumption,” said Roman Arutyunov, co-founder and vice president of products at Xage. “As [distributed energy resources] are starting to increase, this is becoming more and more important.”
Arutyunov said the Xage software can be implemented at the device level, directly on or in front of inverters and meters connected to specific resources, as well as on the microgrid controller. It can record data from transactions, such as energy surplus and demand on the microgrids, and then settle transactions securely, he said.
Zhang said the software isn’t going to be implemented down to the device level at this point, and he emphasized that it’s happening first in the lab, with simulated scenarios. The sorts of transactions being simulated happen at a broad level, between microgrids, as opposed to between individual resources like a solar panel and a battery.
Xage’s software enables secure transactions by verifying all the participants before it authorizes the transaction, Arutyunov said. “There’s exchanges going on all the time, so you need to have a very trustworthy, tamper-proof system for recording those exchanges.”
The Xage software can be programmed to follow certain rules to determine which devices are allowed to participate in transactions, ensuring only authorized participants and devices participate. It acts like a lock so no outside parties can join the system and manipulate energy transactions.
“It becomes even more important as the distribution gets bigger and bigger, broader and broader and as you enable peer-to-peer interactions which may not be visible all the way at the core” or a central data center, Arutyunov said. It can even allow parties to exchange energy without the utility being involved, he said. If, for example, two neighboring communities decided to connect and exchange surplus energy, the utility could act in a central oversight role, or the communities could choose to operate independent of the utility.
Arutyunov said a decentralized system is more secure than a centralized one in which the utility is the single source of power: With the right protections, a breach in a decentralized grid would only affect devices at the point of the breach. But in a centralized system, a breach opens the entire grid to the hacker. In recent years, utilities around the world, including in the United States, have seen more of these breaches.
This wide distribution isn’t that far in the future, he said. “In the next two to three years, we’ll start seeing major deployments” of distributed energy resources and accompanying software. “Then it will start sweeping through the country and the world very quickly.” Arutyunov views the trend similar to smart meter deployments: It took about five years for stakeholders to get comfortable with the technology as utilities changed their business models and regulators changed their policies, and then the meters’ presence expanded significantly.
This hints at an issue ComEd and other utilities will likely contend with in some way in the coming years: As power generation increases at the edge of the grid and utilities no longer act as the sole distributor, what should their primary role be?
Many utilities aren’t ready to embrace new technology like customer-side generation resources and accompanying services such as blockchain software, which could upend their traditional monopoly roles, Arutyunov said. But, he added, utilities will have to evaluate their services if they want to scale up distributed energy resources on the grid.
Both he and Zhang said the energy production landscape is changing. Traditional energy consumers are becoming “prosumers” — customers who also produce energy. The utility’s role is changing, Zhang said: Whereas organizations like ComEd were originally responsible simply for delivering electricity reliably, that role is becoming more focused on delivering it sustainably, using more environmentally responsible energy sources and strengthening the system.
“We see utilities as the natural leader and the driver and provider for that system,” Zhang said. At the end of the day, he said, the utility is still responsible for building the infrastructure to upgrade and interconnect the grid so it can accommodate new, modern technology.