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Industry Analysis
Summary:
Going through the past, present and future of PowerLedger – the project, which is giving electricity users the control and flexibility of their energy supply, while monitoring the supply from the prov

Power Ledger Industry Analysis

Token/s Symbol: POWR, and SPARKS

Industry: Energy and Solar

ICO: $34 Million

Market Cap: $357,761,998 USD (As of January 30, 2018)

Coin Supply: 363,810,715 (As of January 30, 2018)


Power Ledger project description

The Australian based project, Power Ledger, is niched in the solar energy sector, positioning itself as a base platform for the trading and engagement activities of different players around the sector, using their decentralized peer to peer blockchain backed ecosystem to make use of surplus electricity.

The idea is to give electricity users the control and flexibility of their energy supply by gathering data and information of their usage and monitoring the supply from the providers. This provides invaluable information that is then purposed to provide efficient records of the consumption needed as well as future estimates of the potential supply and use of electricity.

Solar energy state and history in Australia

From the 2017 updated Australian energy sector report, published by the Department of industry, science, and innovation; we note that the small-scale solar energy consumption increased by 18% from 2015-2016, which is three times more than that of the natural gas consumption which was at a 5% increase through the same period. This shows that more consumers and companies have integrated the use and implementation of solar into their households and businesses.

This drive is contributed mainly by a cause and effect occurrence, whereby by the end of March 2017, one of Australia’s largest energy production facilities, Hazelwood power station in Victoria, was closed. This created a market gap and manipulation of bill prices and other related fees by other electricity providers due to the competitive market. Thus, most consumers opted to go for renewable energy which is more cost saving in the long-term.

Electricity price trends in Australia

Based on the Residual Electricity price trends published by The Australian Energy Market Commission’s, we see that the cost of electricity has been increasing over the recent years, and is expected to shoot up in 2018, this is as a result of prices volatility which is triggered by the sudden rise in demand for electricity, and continued pressure on The National Electricity Market (NEM) of Australia which controls the wholesale supply of electricity between different states - which underwent a series of changes after the closure of some of the coal-fire-generation facilities.

PV solar systems state in Australia

In 2016 and 2017, there was an all-time growth in the installations of PV solar systems especially in South Australia and Victoria; consumers ventured into this option not only because of the increase in electricity prices but also because of the low costs attributed to the solar technologies. SolarChoice, an Australian Solar Brokers review company, highlighted that over last 4 years through to 2016, the cost of 1.5kW solar systems reduced by 8%, and that of 4kW and 5kW dropped by a 35%. Since the implementation of the 1.5kW solar systems for households is small and would not be significant enough in costs saving, whereas the 4kW and 5kW solar systems would be too large, consumers are opting to find ways of storing this excess energy for nighttime usage using batteries; Coincidentally, the costs of battery storages for solar systems are forecasted to decrease by up to 80% by 2020, this will overall benefit the solar systems industry as well as help in lowering the electricity costs for consumers. Tesla, the manufacturer of electric automobiles, energy storage and solar panels, has the world's largest lithium-ion battery facility based in Australia, this goes ahead to show how much potential this market has.


The Australian Energy Regulator State of the Energy Market Report stated that by 2016 there were more than 1.9 million households already producing self-generated electricity using PV solar systems, this contributed to about 3% of the electricity needs supplied by NEM (National Electricity Market) wholesale electricity supplier. In a more mainstream manner rather than the concept of Power Ledger, some of these households are already distributing and selling the excess electricity to retailers and distributors.

Power Ledger positioning

Power Ledger comes in at the right time and season, having understood their market, industry, service specialization, and potential. They will tackle the concern with excess energy mainly produced using solar PV systems, by providing decentralized applications for distribution, management, integration, control, and monitoring. Their goal is to achieve environmental sustainability, energy security, and energy equality.

Power Ledger already has a set of predefined DApps i.e:

Fully developed: P2P trading.

Built and Under Testing: Electric Vehicles, NEO-Retailer, Microgrid/Embedded Network Operator/Strata, Autonomous Asset (Aa) Management.

Under Development: Wholesale Market Settlement, Distributed Market Management, Power Port, Carbon Trading, and Transmission Exchange.

Current solutions and competitors

Other than individual households supplying electricity themselves, there are other companies that have come in to facilitate these processes, such as Netherland’s Power Peers who created a technology that has a solar-market marching mechanism where households can access self-generated solar from different sources. The technology currently uses an advanced algorithm to make this possible and is working on future implementation of blockchain and other solar energy solutions. 


Even though such companies act as potential competitors for Power Ledger, we see that Power Ledger has been able to position itself in a specific niche and already has a bunch of different areas that they are targeting and working on; this will enable them to compete effectively in this market. These companies, including Power Ledger, are structured to make profits mainly in the fees attached to the transactions, and incentives.

Power Ledger’s token/s framework

Power Ledger has two tokens that are interdependent, POWR token and SPARKS token. POWR token acts as the “access-pass” to the platform’s ecosystem, and is intended to be used for the creation and generation of SPARKS; SPARKS is then used as the base unit of exchange within the platform between different parties and is pegged against the Australian Dollar. The project raised AUD $34 000 000 in Pre-Sale and Main-Sale.

Power Ledger’s team

The team behind Power Ledger is very diverse and experienced, headed by Chair and Co-Founder Jemma Green, who has more than 15 years experience in finance and risk advisory, together with a ton of other co-workers who have experience in other fields such as electricity, solar, energy, IT, software development, system and applications design, blockchain and ICOs, business development, and marketing.

Remarks and Conclusion

Power Ledger positioning is one that has considerably great potential because of the flexibility of their product and concurrent demand and market trends. With the current production of electricity being about 3 times the consumption, we see that this is an actual need that has the potential of being capitalized and improved. They attracted the attention of the Government, which in 2017, gave out a Grant worth $8 Million, to further expand the research and development of new technology and systems in blockchain and data analytics to facilitate distribution systems in energy and water, seeing the inclusion of Power Ledger as a beneficiary.

Power Ledger already has successful projects and achievements; in 2016 they tested their first Australian Blockchain with National Lifestyle Villages where they connected 15 households in the framework. In 2017, 1) They had their First International Deployment with New Zealand’s Vector Ltd., 2) Bank-on-Ramping which allowed the direct exchange of SPARKS with fiat money, 3) Commercial Deployment at Multi-Tenanted Properties in White Gum Valley, Western Australia, that saw the first integration of meter systems using blockchain that allowed users to interact without needing a retailer, 4) Partnered with Indra Australia, a Global Technology solutions provider, to implement a network management system to facilitate self performed interactions, 5) First Electric Vehicle Trading Platform, where they partnered with Synergy, with the intention to power and manage electric vehicle charging.

In 2018, Power Ledger, according to their predefined roadmap, they will continue to grow in Marketing and Partnerships, Beta Test of New Applications, and creation and hosting of First Asset Germination Event.

References:

  • https://www.environment.gov.au/system/files/resources/f02a388d-74eb-4200-96fb-fe2a9d0caf5b/files/energy-update-report-2017.pdf
  • http://www.afr.com/news/power-ledgers-ozfirst-bitcoin-ipo-surges-to-34m-20171006-gyw2lv
  • https://www.energycouncil.com.au/media/7687/australian-energy-council-solar-report_march-2017.pdf
  • https://www.cleanenergycouncil.org.au/policy-advocacy/reports/clean-energy-australia-report.html
  • https://www.aer.gov.au/system/files/AER%20State%20of%20the%20energy%20market%202017%20-%20A4.pdf
  • https://powerledger.io/media/Power-Ledger-Whitepaper-v3.pdf
  • https://powerledger.io/
  • http://www.abc.net.au/news/2017-06-09/finkel-energy-report-explained/8602524
  • https://oracletimes.com/why-power-ledger-powr-could-quickly-become-a-top-10-coin/
  • https://www.powerpeers.nl/about
  • https://bitcointalk.org/index.php?topic=2003922.0

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