An Indie, Off-the-Grid, Blockchain-Traded Solar Power Market Comes to Brooklyn

A new small-scale power grid project is looking to make it easy for a small number of Brooklyn residents to trade and sell their own solar energy using existing power lines and blockchain technology that powers virtual currencies like bitcoin.

The Brooklyn Microgrid, which spans parts of the Gowanus and Park Slope neighborhoods in Brooklyn, will be the first to run off the TransActive Grid platform, which will tie local green energy providers and customers to Ethereum, a blockchain-based platform.

Ethereum allows developers and users to commit transactions through cryptographically-secured smart contracts, which are then validated on a public ledger, much like bitcoin's blockchain.

The draw of the platform is its contracts, which are structured in such a way that they can't be misinterpreted or doctored down the line. Ethereum uses a proprietary cryptocurrency called Ether to transact, but Lo3 Energy, the company behind the TransActive Grid, is trying to find a way to do all its business through US dollars.

Lawrence Orsini, founder of Lo3 Energy, told me that the company's planning to make its first transaction sometime during the week of March 21. It would be the first peer-to-peer energy network transaction in New York, where energy companies are virtually taken out of the picture.

"Nothing changes on the utility grid side. No new wires, no new pipes. This is a financial transaction between people for the thing they want to see happen in their community," Orsini told me.

Orsini says that one of the TransActive Grid's goals is to give people total control as to where their energy is going.

"Where do I want my dollars to go to in my community? Will it go to my neighbor? That's hyper-local. Or can I give a portion of my electrons away to fight local energy poverty—for folks who can't afford to pay their own energy bill? At some point you'll be able to do that," he said.

That's the sort of customer the Microgrid is attempting to attract: the grassroots energy buyer. Bob Sauchelli, a former program manager for the US Environmental Protection Agency's Energy Star program and one of Brooklyn Microgrid's early adopters, told me that he's most interested in the idea of local control the Microgrid is offering.

"Having that local control, and owning your own home, as a lot of people in Park Slope do, are some of the things that's also empowered people to put value into action and go out and install solar panels," he said.

Orsini tells me that Lo3 chose Park Slope and Gowanus for its concentration of existing solar panels, good mix of industrial activity, and for being home to people from fairly diverse working backgrounds.

Sauchelli told me. "You can get part ownership of a solar panel, as long as it's in the same area. That's the exciting thing about it: it's an empowering, decentralized, locally controlled economic and environment initiative."

Peer-to-peer energy isn't a new concept. Vandebron, a Dutch energy company, has been around for nearly two years. It works around the same dead-simple bartering concept: You have a renewable generator (solar panels, wind turbines) and you can lease a portion of the excess energy to others in exchange for money.

In fact, the Microgrid is built on top of that very same idea with a lot more options for control attached to it. Orsini tells me that the community will eventually be able to push emergency energy to critical services, like hospitals and fire stations in the event of a grid shutdown.

Sourcing renewable energy is one of the other problems TransActive Grid claims it'll solve. Most of the renewable energy you're buying won't literally be from renewable sources, but rather, you'll be pulling power from the grid that could pretty much be from anywhere. The end result is that you'll still get power, and utility companies will be pulling in less energy from polluting sources since you've opted for green instead. But the energy you get could still be from a myriad of sources.

Customers may refer to what's called a "Renewable Energy Certificate" to account for utility companies' renewable energy claims and to track its pathways from start to finish, but it's a rather byzantine system for someone who may just want to lease energy off their neighbor's solar panel.

Even though the Microgrid's coverage is pretty limited at just the Gowanus and Park Slope neighborhoods, you have to admit it's offering far more control to its clients than anything that utility companies can put forth. As long as its bottom line stays within the realm of understandability, the Microgrid may prove an accessible platform for green energy buyers.