The China Energy Administration (CEA) plans to look into using blockchain-based power trading platforms to improve energy trade between self-contained power producing units and state and national networks.
Notably, according to a policy paper published on August 25, the CEA, a state organization under the National Development and Reform Commission (NDRC) responsible for drafting energy policy, says the policy would look into the feasibility of small and medium-sized power generating and storage facilities serving local communities.
According to the ECA:
“The Plan for Deepening the Reform of “Decentralization, Management and Services” and Optimizing the Division of Key Tasks in the Business Environment in 2022 has been deliberated and adopted by the Leading Group for Comprehensively Deepening Reform and Promoting Functional Transformation of the National Energy Administration.”
Blockchain technology is being used in electricity metering.
The immutability of blockchain technology, according to the Institute of Electrical and Electronics Engineers (IEEE), may enable transparent and trustworthy electricity metering as well as transaction evidence.
In July, the Yunnan province awarded a contract to a Chinese software company called Insigma Hengtian Software to create a blockchain-based power trading system.
Yunnan has an abundance of hydropower resources and various minor hydropower facilities scattered around the province. Bitcoin miners gravitated to the province prior to China’s crypto prohibition because to its ample energy supply and advantageous pricing structure.
Power outage in Sichuan
It’s also worth noting that the recent heat wave and drought have already harmed China’s ability to produce and supply power.
The province of Sichuan has been facing substantial power shortages in recent weeks, resulting in extensive power outages in both industrial and residential regions.
One of the key causes is that the drought has depleted local reservoirs, resulting in a more than 50% reduction in hydropower, the region’s primary source of electricity generation.