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With the rapid growth of renewable energy and battery storage technologies, Sumitomo Corporation Group anticipates decentralized energy systems becoming an essential function to support efficient use of clean energy. Looking for a partner who can help Sumitomo become an integral part of this ecosystem, LO3 Energy, a U.S.-based developer and operator of blockchain-powered peer-to-peer (P2P) energy platforms became the latest tech-based investment by SCOA and SC. The funding supports LO3 Energy’s commercialization of blockchain-based community microgrids, which will allow consumers to buy and sell electricity directly from one another in a transparent, traceable way.
“LO3 Energy provides peer-to-peer electricity trading platforms using blockchain technology,” said Sho Tsunoda, Senior Associate, Team New Frontier, SC Global Power Infrastructure Business Division, “and creates ‘microgrids’ where residents can buy and sell renewable energy in an efficient way.”
Since the launch of LO3 Energy’s Brooklyn Microgrid, the world’s first P2P electricity trading project, the company has expanded the business in the Americas, Europe, Australia and other developed regions, planning and operating a number of pilot projects.
Mr. Norihiko Nonaka, Executive Officer of Sumitomo Corporation, commented, “Under drastic change and innovation in the power sector, especially rapid penetration of decentralized renewable energy, we have the intention to expand our business into the new field created by LO3 Energy. We will work together and support LO3 Energy’s further growth which can realize a clean, environmentally sound community.” LO3 Energy’s transactive energy platform was pioneered with the Brooklyn Microgrid and the company now runs projects with partners around the world, in the UK, Colombia, Japan, Australia and the United States. Users set preferences on a dedicated mobile app, choosing how and when to use the local energy resources available to them and allowing them to select the specific sources.
The actual electrons flow through the normal grid transmission network, but the private, permissioned blockchain manages the definition of the energy source and the contract agreement to pay for it. This enables a wide range of business use cases, including peer-to-peer energy trading, energy hedging for businesses, virtual power plants, dynamic electric vehicle charging and demand response.
“Transactive energy is the key to unlocking the full potential of a cleaner, more distributed and more flexible grid,” Lawrence Orsini, CEO, LO3 Energy added. “It also gives more choices to our consumers, allowing them to take a more active role in its energy choices. LO3 has developed and deployed its blockchain-based transactive energy platform across multiple markets, and we are delighted to partner with our new investors to further scale this platform globally.”
“The investment from Sumitomo represents a landmark moment for LO3 Energy as we begin to scale our blockchain microgrid networks around the world. Energy is going through a revolution with renewable distributed energy resources fast replacing fossil fuels – but to integrate them efficiently we need to re-invent our energy networks. These investments will help us accelerate the roll-out of our microgrids, which help all stakeholders benefit through local energy transactions and demand response energy management on a building-by-building level.”
Lawrence Orsini, CEO, LO3 Energy
“Sumitomo is at the forefront of the changing market dynamics. This blockchain- enabled electricity trading both identifies the sources of electricity and provides the assurance of knowing your electricity is green.”
Bill Cannon, GM, SCOA Infrastructure Group
“This deal is aimed at SC/SCOA developing new business that meets the challenges of the 3Ds – Decarbonization, Decentralization and Digitalization – which are the key drivers of the current energy transition. Sumitomo’s renewable energy goals can be achieved by promoting decentralized solar power with LO3 Energy’s platform, as well as by supporting their growth. Together with LO3, SC/SCOA will contribute to pursuing a society-oriented goal of a more stable supply and a more efficient use of renewable energy. SC/SCOA believes that LO3 Energy’s promising technology will bring unique opportunities in the future of our energy business.”
Sho Tsunoda, Senior Associate, Team New Frontier, SC Global Power Infrastructure Business Division