The U.S. Congressional Research Service released a report detailing the potential uses for blockchain in the national energy sector.
In a report titled Bitcoin, Blockchain, and the Energy Sector, published August 9, the legislators detailed the current state of energy consumption related to cryptocurrency mining, both nationally and internationally. They also explored possible ways to regulate the energy-intensive mining process, and to integrate blockchain technology in current energy systems.
Some of the opportunities for blockchain include placing utility bill transactions on a smart grid, supporting electric vehicle charging infrastructure, and distributing energy resources.
“Traditionally electric utilities are vertically integrated. Blockchain could disrupt this convention by unbundling energy services along a distributed energy system,” according to the report. This could lead to greater industry transparency, efficiency, and competition among energy producers.
Additionally, blockchain could increase consumer choice in the energy market. For instance, the researchers cite the ability to purchase excess energy “produced by their neighbor’s solar panels.”
In April, the U.S. Department of Energy announced a $4.8 million funding grant for universities to research and develop blockchain use cases for the energy sector.
Costs of crypto mining
The agency calculated that nearly 1 percent of the country’s electricity generating capacity goes towards mining cryptocurrencies, a rate they observed increasing year over year. The researchers noted that crypto mining can burden a municipality’s power structure and increase consumer rates.
For instance, in Plattsburgh, New York it was found that crypto mining “contributed to an increase of nearly $10 to monthly electricity bills in January 2018 for residential customers.” This surge in energy use contributed to an 18-month moratorium on any new cryptocurrency mining operations in the city.