Blockchain in the energy sector is still in its infancy but it is moving forward at a fast pace. Look no further than charging for electric vehicles. Using blockchain technology, peer-to-peer networks have established marketplaces to connect EV drivers so they can share charging stations with each other. Residential and commercial EV owners can make a profit by allowing others to access their chargers, and drivers have the flexibility to charge their vehicles at different locations. Experts argue that this new application of blockchain has the potential to reduce range anxiety for drivers, increase the attractiveness of EVs, and pave the way for changes to the electricity grid.
Residential and commercial EV owners can make a profit by allowing others to access their chargers, and drivers have the flexibility to charge their vehicles at different locations.
“It’s Airbnb for EV charging,” Preston Roper, COO of eMotorWerks, told The Fuse. eMotorWerks, a California-based firm that focuses on EV charging technologies, was the first company in the United States to establish a peer-to-peer network in its partnership with Share&Charge. A host of other companies using blockchain to increase access to electric charging stations have rapidly reached the market, in the U.S. and elsewhere. Some of these include Everty (in Australia), Oxygen Initiative, and Zap-Map (in the U.K.).
Companies in banking, finance, insurance, oil trading, and utilities have been moving to blockchains—decentralized distributed ledgers that record online transactions—to improve efficiencies, while cryptocurrencies such as Bitcoin have garnered a lot of attention—and skepticism—of both regulators and the general public. Some advocates of blockchain believe that it will reshape industries and foster greater data sharing and transparency. The lack of a regulatory framework, however, along with users not fully trusting new networks and cryptocurrencies, remains a hurdle to acceptance and implementation.
Consumers often cite range anxiety as a factor in not buying an EV—the worry that your vehicle will run out of battery power on a long drive before you can find a charging station. Without the proper critical infrastructure widely available, potential buyers may remain hesitant to purchase an EV. “It’s still the case that about 80 percent of vehicle charging happens at home,” Roper told The Fuse. “Vehicles now have a range of 150-250+ miles, which is very liberating and can cover daily commutes. But for longer trips, drivers need access to charging stations, which is where corridor charging comes into play—a critical piece of the puzzle.”
“Vehicles now have a range of 150-250+ miles, which is very liberating and can cover daily commutes. But for longer trips, drivers need access to charging stations, which is where corridor charging comes into play—a critical piece of the puzzle.”
Currently, there are approximately 50,000 EV charging outlets in the U.S. at more than 17,000 public locations, but 125,000 stations nationwide sell gasoline and diesel. Approximately half of EV owners in the U.S. have their own chargers at home, and over 800,000 EVs are currently on the road. Theoretically, peer-to-peer networks could increase the number of available chargers by hundreds of thousands—although not every owner will want to commit to joining a network.
Blockchain platforms can help relieve insecurity over refueling. Through the peer-to-peer network, EV users can access locations of participating homeowners on their app to charge their vehicles. The amount of time and energy used to charge the vehicle is tracked by a proprietary service, and then a ledger transaction takes place with a digital payment from the driver to the owner of the charger. “Using P2P EV charging platforms, private owners can make their chargers available for public during the times they are not being used by them,” said Hassan Zaheer, principal consultant at Power Technology Research, in a blog post for Engerati, which works with utilities to adopt new technologies. “In return, they can earn some cash on the side from their idle charger by increasing its utilization.”
Val Miftakhov, founder of eMotorWerks, said those with chargers in urban areas that see a lot of traffic could make about $500 per year, helping them pay off installation costs and the costs of charging their own vehicles.
Besides EV drivers accessing private chargers, there are other positive factors that blockchain can enable for the EV market. Possible developments include greater implementation of smart grid technology, the use of shared batteries, and the entry of new participants in both the charging and utility spaces. “The distributed ledger capability allows for new providers who can resell charging station access in small transactions,” Roper told The Fuse. “You’re not limited in where you can buy electricity or from whom you purchase.”
“The distributed ledger capability allows for new providers who can resell charging station access in small transactions.”
Peer-to-peer networks can also foster greater usage of vehicle-to-grid (V2G) technology. V2G uses EVs as an energy storage solution while they are parked, which is on average more than 80 percent of the time. This process allows EV owners to make money by selling electricity back to the grid. Besides providing consumers economic opportunities, V2G also helps smooth grid imbalances. V2G’s goal is to fully optimize the vehicle’s charging and the use of local generation. In Denmark, V2G has been a big success, with fleet operators of Nissan Leafs earning over $1,500 in one year.
Challenges to blockchain, peer-to-peer networks
Besides the concerns about regulations and cryptocurrencies, there are other challenges to blockchain technology in the EV charging space. The market is in its early stages and it is unclear when it will reach critical mass. The technology works smoothly—users have been pleased with it. But can companies offering parking services turn a profit? Similar to other start-ups in the transportation sector, the ability to sustain a business model over a long period of time is uncertain. At the same time, consumers may not be fully comfortable with sharing their property with strangers, limiting growth potential.
Peer-to-peer transactions could offer only a temporary solution.
Lastly, peer-to-peer transactions could offer only a temporary solution. Longer ranges in new EV models and growing public charging infrastructure have the potential to hinder development in this sector. Some investors may be hesitant to own part of a company that they see as only a stopgap measure. Nonetheless, the growth of blockchain in EV charging over just the past year underscores its potential to offer solutions for the growing EV market, and shows how technology and the shared economy are quickly changing transportation.