Array of Solar panels at Photovoltaic power station
Alectra Utilities, the second largest municipally-owned energy utility in North America servicing several major municipalities in the Golden Horseshoe region of Ontario (of which Toronto is an anchor) such as Hamilton, Mississauga, and Brampton and Interac, a Canadian interbank network that links together banks and financial organizations to be able to provide Canadians with financial services ranging from online e-transfers, to debit cards, have started working together to explore rewarding those people who use renewable energy in a grid-efficient way with monetizable rewards served through the Interac payment network. Alectra services about 1 million customers in Ontario, Canada.
Interac has been looking at different use cases where blockchain principles can help it innovate in terms of creating new business model. Using IBM’s implementation of the Hyperledger framework, it has started sending “sparks” to quickly reward people for using renewable energy, using distributed ledger technology to federate data and decision-making between it and the electrical utilities it is looking to work with.
During peak hours, overuse on the grid can quickly lead to problems — and the monetary incentives help customers decide to choose renewable energy in the first place, in the form of solar energy, batteries, and electric vehicle chargers, and time their usage patterns to slow congestion and surge demand.
These near-instant payments are then immediately spendable — the first transactions recorded by a customer were for some ice cream and pizza. Users earned an average of about $100 CAD in the two-month portion of the pilot where they could earn money. This is a pilot in production that is already helping thousands of people get incentivized to use renewable energy in the most efficient way possible.
Micro-payments and federated models of corporate control on permissioned networks are already well-known. Interac isn’t building its own technology, but is rather relying on an already built-up platform and approach. Interac also isn’t seeking to create self-sovereign or distributed forms of identity for access to these payments. Payment is delivered on Interac’s pre-existing network and infrastructure rather than a permissionless blockchain.
What this pilot is notable for is how quickly it has scaled with one energy utility to thousands of end consumers in production, the quick extensible nature of the setup to help other utilities benefit, and the fact that Interac is playing with blockchain principles in the first place — given its role as a consortium of sorts for large Canadian financial institutions.
It’s an indication that Interac is looking at new business models and ways of working with partners that encompass blockchain principles and the need to send information in verified and validated ways, at relatively low cost, with the right amount of delegation and control among different partners. With this pilot, Interac is looking to stake its foot in the ground and bring the scale, customers and brand it has in Canada to the blockchain applications of the future.