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IOTA introduces energy trading platform for smart cities

  • The IOTA Foundation introduced its energy trading platform for smart cities.
  • The solution will be promoted together with Alpha Venturi beyond the +CityXchange project.

In a new blog post, Dr. Michele Nati, Head of Telecommunications and Infrastructure Development at the IOTA Foundation, explained how the energy trading platform developed for the +CityxChange works and what potential it has. As Dr. Nati stated at the beginning, the energy trading platform was awarded by TM Forum as part of the innovation competition “TM Forum Catalyst”, which was launched at the Digital Transformation World Conference, the Forum’s flagship event.

Why use IOTA, and not centralized infrastructures

With this solution, the IOTA Foundation addresses the problem that today global energy consumption has its “two main vectors in buildings, which account for about 40% of total primary energy demand, and in transport, which accounts for about 28% of the same energy demand”. To stop this trend, smart building technologies are currently being developed.

The Distributed Ledger Technology (DLT), especially the IOTA Tangle, can be a crucial piece of the puzzle, as Dr. Nati investigates. By combining both technologies, the energy generated and consumed by positive energy buildings can be measured and even predicted in real time.

Centralized, cloud-based infrastructures would reach their limits. “A black box approach introduces a single point of failure and the threat of data or processing manipulation,” says Dr. Nati. For this reason, emerging open source technologies such as DLTs are increasingly attracting attention. IOTA in particular could offer unique advantages, Dr. Nati added:

IOTA can process value and data transactions on the same infrastructure. IOTA provides an open-source software technology that can be embedded directly with IoT devices (i.e., smart meters), allowing to extend the scope of this digital infrastructure innovation to the IoT edge of the electricity network. Energy assets can immediately share demand and supply for energy surplus, without the need for centralized data aggregation.

How the energy trading platform works

The proposed system comprises three layers: a data layer for the “advertising” of energy suppliers, a transparency layer for the tracing of energy and data flows, and a payment layer for micro-payments, which are necessary for the payment of electricity supply.

To promote the decentralization of energy trading, the IOTA Foundation has also developed the IOTA Asset Module. This is an embedded IoT device, using a PyCom card, with an integrated energy meter that allows any device to publish data directly on the IOTA Tangle. The module also integrates an IOTA Wallet so that the connected devices can perform billing fully automatically.

After the initial configuration, the module automatically generates excess energy supply and demand, and sets them on the Tangle. As soon as an energy exchange is confirmed, the “payment and invoice verification” module is triggered and a payment request from a consumer to the producer in the same stream is logged. The IOTA module monitors the payment via IOTA.

In particular, IOTA Streams and IOTA Access can also be used to protect the data integrity and security of the system participants. Both solutions will be useful to protect the system from unauthorized access and fraudulent behavior of merchants. To provide this infrastructure, the IOTA Foundation has developed a number of hardware and software components. A simplified high-level overview of the implemented architecture is shown in the following figure.

iota energy marketplace

Source: httpss://blog.iota.org/iota-powered-smart-grid-infrastructure/

The marketplace is currently being used as part of the +CityxChange project on the NTNU campus in Trondheim. In order to promote the use and adoption of the solution, the IOTA Foundation works together with Alpha Venturi. The latter is currently setting up a spin-off company and related research and innovation initiatives to promote the +CityXchange project and find interested cities and other partners.

About Author

Jake Simmons

Jake Simmons has been a crypto enthusiast since 2016, and since hearing about Bitcoin and blockchain technology, he's been involved with the subject every day. Beyond cryptocurrencies, Jake studied computer science and worked for 2 years for a startup in the blockchain sector. At CNF he is responsible for technical issues. His goal is to make the world aware of cryptocurrencies in a simple and understandable way.

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