Shell Subsidiary Establishes Virtual Power Plant in Germany

Shell Subsidiary Establishes Virtual Power Plant in Germany

Sonnen Group, a subsidiary of Royal Dutch Shell, has signed an agreement with the Energy Network Foundation (EWF) to use the latter’s blockchain in establishing a virtual power plant (VPP) in Germany.

The plant would provide a network of residential energy storage systems aimed to benefit from excess wind power. In addition, it will reduce the curtailment of renewable energies in Germany.

With the closure of coal-fired and nuclear power plants in Germany over the next years, the country has witnessed a boom in clean energy production as several green energy producers boosted operations to fulfill demand.

Nevertheless, the seasonal nature of energy production and demand increased renewable wastage. In 2018, Germany has reduced 5.4 terawatt hours of renewable energy, and curtailed 3.2 terawatt hours of wind energy in the first quarter of 2019.  

Jean-Baptiste Cornefert, managing director of Sonnen, said:

“With a flexibility market for renewable energies and the automatic exchange of supply and demand, we are realizing the next step towards a smart grid that can deal much more flexibly with fluctuations from renewable energy.”

“Virtual power plants such as those from Sonnen are the technical building block for this power grid that has been missing up to now and can help to ensure that less green energy is lost,” he added.

The project will boost the national power grid by storing excess wind energy generated through a network of the company’s patented “Sonnenbatteries” that are networked using the distributed ledger technology (DLT).

Transactions carried out by smart contracts; payments in DAI

Transactions between the grid and Sonnen are carried out by smart contracts, with transaction payments paid in the form of stablecoin Dai (DAI).

Micha Roon, CTO for Energy Web Foundation, said:

“Matching renewable supply with available demand is at the core of EW Origin. Sonnen’s project is a vision of the future: using a blockchain-based approach to reduce curtailment from large-scale wind energy by leveraging the available capacity of distributed batteries. When we at EWF talk about accelerating a low-carbon, customer-centric electricity system, this brings that to life.”

The blockchain-based VPP aims to encourage further growth of Germany’s clean energy output by averting an overload to the power grid.

Germany’s financial watchdog Federal Financial Supervisory Authority (BaFin) released new guidance, considering Bitcoin and cryptocurrencies as legal financial instruments in Germany.

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Rabea Maguid 551 Articles
Rabea Maguid is a journalist completely obsessed with crypto industry. He holds B.A. from Al-Azhar University, and has a background in journalism and economics. Rabea Maguid likes to think about the future in a positive way, and sees blockchain as a potential driver of deep societal change.