Is P2P Energy Trading the Future of Electricity?

Climate change is a headliner issue, countries around the world looking to address in their own ways. Along with national goals set, new business models such as peer-to-peer (P2P) energy trading have emerged to accelerate this drive.

 

Singapore has punched above its weight in the global fight against climate change since the ratification of the 2015 Paris Agreement. Aside from implementing a Carbon Tax, Singapore has set a goal to have solar energy fufil 10% of the nation’s energy mix, with a longer-term mission of halving emissions by 2050.

 

Solar energy plays a major role in Singapore’s low carbon future, with it being the most promising renewable energy source. According to the National Climate Change Secretariat, Singapore is aiming to increase its installed solar capacity to 350 MWp by 2020, and 1 GWp beyond 2020, equivalent to powering about 210,000 4-room HDB dwellings.

 

P2P energy trading – a solution for our ever-changing future

 

However, challenges such as land constraints remain in deploying solar energy on a large scale. One highly viable approach to catalyse this shift is P2P energy trading models. These new models allow the rooftops of commercial and residential buildings to be maximised to fulfil Singapore’s solar potential.

 

P2P energy trading models usually comprise 4 components; prosumers (individuals who own the means to produce renewable energy, such as solar panels, who both produce and consume energy), consumers, an energy grid, and a secure platform to facilitate transactions.

 

In a nutshell, these models allow prosumers to sell excess energy to consumers at mutally-agreed terms and prices.

 

P2P works. Here’s why.

 

• Cutting out the Middle Men
• Prosumers deal directly with consumers and have the ability to set their price, higher or lower than the market. Dealing directly with the consumer eliminates the costs typically incurred by intermediaries, potentially resulting in more favourable energy choices.

 

• Increased Transparency and Democratised Access to Renewables
• Unlike the opaque nature of traditional energy retailers, P2P energy trading grants consumers with increased visibility. They have full control who supplies them renewable energy with access to a wide range of renewable energy prosumers. 

 

• Economically Sustainable
• A major deterrent of solar panel adoption has been the upfront investment for infrastructure. This traditionally requires 8 – 10 years for owners to recoup their investments. Of course, more efficient systems allow owners to breakeven in 5 – 6 years. P2P energy trading overcomes this challenge by enabling owners to monetise their surplus capacity, shortening the period of recoupment.
• On the public sector front, governments in Japan and Europe faced considerable challenges of balancing subsidies and tariffs to encourage the uptake of clean energy. While popular, the approach of relying on feed-in-tariff requires a significant amount of subsidies from the government. P2P energy trading models solves this problem as the cost are significantly lowered. Power companies have access to more green energy at no additional cost and may even earn revenue.

 

Trials in the Region

 

While P2P energy trading holds many benefits, it remains a relatively new energy model in Asia, with some countries embarking on their own trials. Apart from Singapore, energy authorities in Australia, Japan, Thailand, and Malaysia are also exploring the potential of P2P energy trading.

 

With Electrify’s P2P energy trading platform—Synergy—we have developed SolarShare in collaboration with Senoko Energy and ENGIE Factory, Being Singapore’s first commercial trial, SolarShare aims to showcase the commercial viability of Synergy. Through SolarShare, prosumers and consumers can trade energy across Singapore’s main power grid between, while monitoring their energy flow in real-time. Prosumers with installed solar panels can sell their excess green energy for better returns. Similarly, consumers can use green energy at competitive prices, while supporting their local community.

 

Utilizing SolarShare and Electrify’s Synergy, we see P2P energy trading as the preferred energy model for a more sustainable future. We have our sights set on changing the energy landscape of Asia amid the climate change conversation, and will continue to stay the sustainable energy cause in collaboration with our partners. Want to make history with SolarShare? Register your interest at http://www.solarshare.sg