Reply to post: Re: What on earth...

Kill the blockchain! It'll make you fitter in the long run, honest

Ledswinger Silver badge

Re: What on earth...

..democratising the energy supply...

...does this mean?

Draw up a chair, and I'll explain, and help cure your insomnia. In the electricity system, all the generators pile in (hopefully) enough watt-hours to keep everything ticking over, at the instruction of the System Operator. Currently that's National Grid, although the wankers of Ofgem would like that not to be the case. At your end you turn on the light switch, hopefully it works. Your supplier bills you based on your meter reading. But how do each of the c90 suppliers, and hundred of industrial customers who trade wholesale on their own account pay the many generators the right amount, and who pays for the c12% system losses? How are things sorted out when a supplier gets their sums wrong and hasn't contracted enough generation, or has too much? How does the system work so that suppliers can flog you electricty for 13p/kWh all through the winter, when peak wholesale prices can exceed £1.50 per kWh if there's a crunch. TaDa! The Balancing & Settlement System sorts this. There's a broadly similar system for gas. All in there's over 10,000 pages of system codes, so joining this party requires you to be pretty big and clever, or you can pay somebody big and clever to do it for you. All the arrangments and codes are publicly available, you can find them on the web and set yourself up as an energy trader and party to the Balancing & System Code if you want.

According to the blockchain beard-fondlers, there's a problem here, that there's only one body who runs this system - for electricity it is Elexon. Somehow that's a closed, anti-democratic system, that wankchain could do away with. And it would supposedly enable magical things like peer-to-peer trading of energy, for example from residential PV owners directly to other parties. You can do that already with a "private wire" connection, but not if the electricity goes into the grid. Of course, if the PV owner exports to the grid, then blockchain "provenance" turns to ash because you can't direct a specific kWh, nor label it, but lets not let facts spoil their soya lattes. One interesting aspect of a block chain energy system is that the customer would need to either 100% accurately forecast and contract their capacity directly, or pay somebody else to provide the additional power above that. Paying to manage the risk in advance via a counterparty is expensive, taking the risk unhedged and uncontracted is financial suicide (as various small energy suppliers have found). In blockchain energy system, all those risks can be yours.

In reality, the balancing and settling systems are really cheap to operate and effective. Like any good system, they work quietly in the background, 99%+ of the population don't know, don't need to know and don't care. The gas settlement system recently had a huge overhaul (Nexus) because it was running on an ancient lash up of systems, but outside the industry nobody knew or cared, and life went on as normal.

So there's no value in replacing a (nominally) closed ledger with a distributed open version. As with everything blockchain, it is a complex, unproven solution searching in vain for a problem. But with shit head consultants bombarding our directors about the "importance of blockchain, AI and virtual reality, we keep on having to tell them "forget about it, it isn't a huge industry disruptor, its just a crock of shit being touted by charlatans".

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