Go Green and Invest in Renewable Energy
Green energy address many global issues and the push for its development is accelerating. Today, renewable energy is not only seen as the answer to climate change, it addresses many political, economical, social and environmental issues as well. Mitigating greenhouse gases, curtailing pollution, reducing dependence on fossil fuels, increasing energy security are some of the benefits of green energy. According to REN21 2017 report, As of year-end 2016, renewable energy targets were in place in 176 countries. The majority of targets continue to focus on renewable energy use in the power sector, with targets for a specific share of renewable power instituted in 150 countries.
As reported by the Post Carbon Pathway report, the most significant roadblocks to green energy development widespread is primarily political and not technological. Identified major roadblocks include climate change denial, fossil fuel lobbying, political paralysis, unsustainable energy consumption, outdated infrastructure and financial constraints.
Financing Green Energy
Renewable energy tends to have high setup cost and low ongoing operating cost, that makes long-term financing a necessity. However, investment decisions are biased towards financing projects that allow for shorter terms returns. This causes a lack of project financing in the renewable power industry or makes the necessary capital very expensive.
WePower network offers an innovative solution to this problem by connecting green energy consumers, producers and investors through a blockchain platform. When a green energy producer wants to finance a new set-up, they can sell part of their to be produced energy as energy tokens. This allows them to receive the necessary equity capital for the projects and to increase the return of equity ratio by 25%. By buying the energy tokens, users are buying future energy at below market price. This will benefit users when the price of electricity increases in the future. The return of such investments varies from 15 to 20%.
These energy tokens represent smart contract under which renewable energy producers are obliged to produce in a certain amount (kWh) at a given timeline in the future. Energy tokens will also contain information about the origin and type of green energy it represents (e.g solar, wind, hydro). These tokens can be easily traded on WePower platform.
Contributors, who support WePower at a very early stage will receive WPR tokens, which will give a right to receive part of the energy tokens circulating within the platform as a reward. Renewable energy producers using WePower will be obliged to donate up to 0.9% of the green energy produced, issued in the form of energy tokens directly to WePower community. A holder of WPR token can either exchange these energy tokens for green energy or sell it before the energy produced reaches the grid. This ensures liquidity for the contributors who are from places where WePower is not yet connected to the energy infrastructure.
The real value of WPR tokens will grow as WePower expands and more renewable energy producers start using the platform. More producers equate more donated energy to the community. Based on the current partnerships with producers operating in Spain, WePower forecasts to reach 198 mln kWh of energy production in 3 years, which is the equivalent to 7,9 EUR mln of energy donated to the community. The company also is currently in talks with several green energy producers across Europe and new partnerships should be announced soon.
The WePower token model has also been clarified with the regulator, the model does not fall under financial regulations as the WPR tokens are not a financial instrument, instead, they are access to the reward which is the donated green energy.
Moreover, the platform itself is not considered to be a trading facility. ‘The energy tokens and underlying smart contracts represent power-purchase agreements, which are moved to the digital medium. These agreements evidence how much energy must be provided to a particular person. Therefore, based on such power purchase agreement the objective of sale/purchase is the energy that will be settled physically. Following such technicality, tokens are not financial derivatives and the platform itself does not fall under financial law regulation as a trading facility,’ explained by Arturas Asakavicius, co-founder of WePower in his article.
Government Support for Green Energy Blockchain Technology
According to Intergovernmental Panel on Climate Change, even if carbon emissions are stabilized at the current level, there is 25% chance that global warming would surpass two degree Celsius within 20 years. By 2050 the decline in CO2 emission needs to reach 1 metric ton per capita to prevent further sea level rise, Arctic sea ice decline, ice cap meltdown and increase in ocean acidity. With the Paris Climate Agreement, countries have agreed to limit consumption of energy produced by fossil fuel. However, this cannot be done without full transparency in energy production and carbon emission accounting, as there are no tools to ensure reliability, accuracy, and transparency. The systems employed by most countries are vulnerable to data manipulation.
Based on WePower business model, the platform will monitor renewable energy production using the blockchain technology and the issuance of energy tokens. Each Energy token will represent every kWh of energy produced. Since energy tokens will be accounted on the Ethereum blockchain, the public ledger ensures that the data of the produced energy is accurate and immutable. With such technology, the emission accountability can be put at the very top of priorities.
The Ministry of Energy of the Republic of Lithuania has expressed their support to WePower network in a letter of support:
‘We are strongly interested in the results of WePower network projects and believe that establishment of a novel technology for the enhanced focus on renewable energy is the future. Successful collaboration would be beneficial to Lithuania and any other country that would like to employ WePower network technology and ensure value added to both consumers and businesses’.
Source: cryptocoinsnews
