The world’s fifth-largest oil and gas firm whose net worth is $262 billion has partnered with a blockchain-based firm LO3 that is located in New York, Forbes reports.
Europe’s giant oil and gas firm has pumped in an undisclosed amount of dollars in LO3 Energy whose platform Exergy monitors energy using the blockchain technology.
In the recent past, Shell has been keen on exploring the blockchain technology in its operation and this partnership marks the fourth public investment in a blockchain-based startup, Forbes said. The other three platforms that Shell has invested in are Vakt, Komgo, and Applied Blockchain.
As per the report, the gas and oil company has the leverage to turn its investment in LO3’s native tokens referred to as XRG and this will help in incentivizing the platform and there will need to access the decentralized energy grid. Initially, LO3 had planned to fund its project using an initial coin offering (ICO) using its XRG token, however, it has halted the idea until further notice.
The LO3 platform or Exergy is developed to monitor the flow of energy as it is included to a shared energy network in a locality. This will allow the residents who buy their power in the locality to be absolutely certain that it was indeed generated from a clean source windmill, a solar panel or a gerbil operating on a treadmill.
If triumphant, LO3 and its rivals in the growing “transactive energy” sector, could alter the work of the conventional electricity transmission and distribution firms such as Con Edison in the United States and Western Power Distribution in the UK from just installers of underground cables, to administrators of more coherent, distributed local energy grids.
Shell Ventures investment director Kirk Coburn explained the partnership:
“As we move into a less carbonized future, Shell aims to invest in innovative companies that will help enable the energy transition. LO3 Energy fits right in that space.”
The partnership also brings in other players in the energy sector from around the world like Sumitomo Corporation Group based in Japan.
Although the details of the investment were not disclosed Coburn was categorical that he will be part of LO3 board as an observer and could later become a full board member if there are future investments.
Lo3 is also reportedly developing another token apart from XRG known as Anergy to enable consumers to sell data regarding their energy usage to various third party firms in the future.
Currently, although LO3’s Exergy is developed on the Ethereum blockchain there are plans to design it to integrate with the EOS blockchain.
Cointelegraph reports that LO3 is not the only one to develop a peer-to-peer energy distribution network. A few weeks ago Power Ledger, based in Australia, said it will soon release its decentralized energy distribution network in Austria’s second-largest city, Graz. just like LO3, Power Ledger also wants to optimize energy management first before eventually moving to zero-carbon energy.
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