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How Blockchain can further the cause of electric vehicles

  • According to researchers, EV charging infrastructure could get a further boost if blockchain is integrated into energy systems
  • Countries such as India and those in the European Union are pulling out all the steps to strengthen the EV ecosystem

Bengaluru: Charged up with the idea that electric vehicles (EVs) hold the future of energy and transportation, many countries such as India and those in the European Union are pulling out all the steps to strengthen the EV ecosystem with battery storage manufacturing plants, besides offering a host of financial and tax incentives.

While all these initiatives are steps in the right direction, many researchers believe the EV charging infrastructure could get a further boost if blockchain is integrated into energy systems.

A new study by researchers at the University of Waterloo, for instance, reveals that there is a lack of trust among charging service providers, property owners and owners of EVs. With an open blockchain platform, all parties will have access to the data and can see if it has been tampered with, researchers insist. Their reasoning is that using a blockchain-oriented charging system will allow EV owners to see if they are being overcharged while property owners will know if they are being underpaid.

Blockchain, primarily known for powering cryptocurrencies like bitcoins, is a form of Distributed Ledger Technology (DLT) that promises to reduce costs and establish trust, but faces challenges like the speed of processing transactions. Its popularity lies in the fact that participants have a copy of the ledger’s data that contains the most recent transactions or changes, thus reducing the need to establish trust using traditional methods.

"Energy services are increasingly being provided by entities that do not have well-established trust relationships with their customers and partners," said Christian Gorenflo, a PhD candidate in Waterloo's David R. Cheriton School of Computer Science, in a 14 August press statement. "In this context, blockchains are a promising approach for replacing a central trusted party, for example, making it possible to implement direct peer-to-peer energy trading," he added.

In undertaking the study (recently published in the 'Proceedings of the Tenth ACM International Conference on Future Energy Systems'), Gorenflo, his supervisor, professor Srinivasan Keshav of the Cheriton School of Computer Science, and Lukasz Golab, professor of Management Science, collaborated with an unnamed EV-charging service provider who works with property owners to install EV supply equipment that is used by EV owners for a fee.

The revenue stream from these charging stations is then shared between the charging service provider and each property owner. The EV supply equipment is operated by the charging service provider, so the property owners must trust the provider to compensate them fairly for the electricity used.

From the case study, the researchers deduced that to incorporate blockchain technology into an energy system, the involved parties must first establish trust between themselves. Second, the parties concerned should design a minimal blockchain system including smart contracts that resolves the trust issues identified in the first step. Finally, with the trust-mitigating blockchain in place, the rest of the system can be migrated iteratively over time. This allows the business model to eventually grow from a legacy/blockchain hybrid into a truly decentralized solution, the researchers said.

According to Gorenflo, "In the end, we could even have a system where there is machine-to-machine communication rather than people-to-machine. If an autonomous vehicle needs power, it could detect that and drive to the nearest charging station and communicate on a platform with that charging station for the power."

While blockchain implementations in India especially have centred mostly around the banking, financial and insurance services sector (BFSI), Jio recently announced it will install one of the largest global blockchain networks in India, comprising “tens of thousands of nodes operational on day one", over the next 12 months.

That said, integration of blockchain technology into energy trading is now being touted as a promising area of research, and many studies have made efforts in this regard.

Switzerland-based The Share&Charge Foundation, for instance, is building a decentralized blockchain system for EV charging, to support payment and contracts. It uses the Open Charge Point Interface protocol (OCPI) protocol for the peer-to-peer (P2P) connections between service providers and charge point operators. According to Share&Charge, the combination of OCPI with blockchain technology can result in secured contract and connections between parties and improved payment and settlement.

During the 'Global Blockchain Congress–Consensus 2018', organised by the Department of Information Technology and Electronics, Government of West Bengal in December 2018, researchers from New-Delhi based The Energy and Resources Institute (Teri) made a presentation on the 'Application of Blockchain in Modern Day Power Systems: Trendsetting a New Paradigm'. Teri's proposal, made by Alekhya Datta, Fellow, and Shashank Vyas, Associate Fellow, covered use cases for EVs, distributed battery storage, grid-connected microgrids, and rooftop solar PV project financing using blockchain.

As an example, the Teri researchers pointed out that privately-owned EV charging stations could be used to charge some vehicles passing near the station and the transaction of bids of charging station owners, power/energy flow, billing and real-time settlement of payments could be managed over a blockchain.

Similarly, IIT-Kanpur researchers have proposed that since current billing systems lack transparency, enabling the service provider to overcharge the customer, blockchain could be used to develop a "verifiable billing" system.

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