Tech Talk | Decentralising energy management and VPPs

Swedish startup Sourceful is proposing an ‘energy subnetwork’ within the Helium ecosystem to deliver what it claims is “the world’s first decentralised virtual power plant” (VPPs).

Over the past few years, many crypto-based initiatives have emerged that claim to enable users to gain ‘rewards’ for either generating renewable energy or enabling others to do so, with those rewards paid in the form of a proprietary but usually exchangeable crypto-token.

The latest of these is from Sourceful, or Scrful as it abbreviates itself, an emerging energy company that is proposing to implement an ‘energy subnetwork’ within the Helium ecosystem.

Helium is a blockchain-based decentralised IoT LoRaWAN wireless network that is implemented in the form of ‘hotspots’ for connecting devices to the internet by individual owners, who look to earn rewards from this service.

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Styling itself as the ‘people’s network’ Helium has become quite widely implemented with almost 1 million hotspots around the world, the majority in the US, Europe and China, and is now looking to introduce ‘subnetworks’, with Scrful’s apparently one of the first.

Such subnetworks, with implementation intended via a firmware upgrade, would run on the Helium network and open up potential additional reward streams for the participating hotspot owners.

Decentralised VPPs

Srceful’s proposal is to incentivise and reward users for solar power production and battery energy storage, while also enabling data collection and control of these resources.

Via the energy subnetwork-enabled gateway, which is connected to the home network via the internet router and runs the Helium IoT network, users would onboard their energy resources and the collection of the data and control of those resources would be enabled.

The gateway signs the data from the inverter so that its source is known and through the control that is enabled the individual resources are then proposed to be coordinated in the form of a virtual power plant.

In turn, Scrful would lease the VPP to flexibility providers or utilities with ultimately some reward for the participants in the form of ENERGY tokens, which would be Solana-based and presumably exchangeable for the Helium HNT tokens.

Scrful released their proposal on July 2 and in a subsequent statement said they had been thrilled by the engagement and support received for it.

Following engagement with the Helium community the refinements made “reflect our commitment to creating a solution that benefits all stakeholders in the Helium ecosystem while pushing forward the decentralisation of energy management.”

A viable concept?

That is the theory but what about the practice?

There is an initial investment in the form of the cost of the gateway and then there is the ongoing electricity costs to run it, which must be covered by the ‘rewards’ that are earned.

As the number of tokens is set to be limited – and planned to be minted over 36 months – they may have investment potential but cryptocurrencies are notorious for their variability, although few exhibit the extreme variations of Bitcoin.

The HNT tokens, for example, are currently trading at around $5 and appear to be averaging in the range $5-10 after a low in 2023 around $1 following a late 2021 peak around $50.

For those interested, the full proposal is detailed as HIP 128 on github.

What is your opinion of the proposal and have you had, or are you currently having, experience with the Helium network?

And does this appear as a viable means of incentivising DERs and the creation of VPPs?

Jonathan Spencer Jones

Specialist writer
Smart Energy International

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