Author: Annebeth, United Kingdom
You might not be too familiar with Moldova, a small country lying landlocked in Eastern Europe, however its latest efforts to finance solar power projects with cryptocurrency will totally enlighten you.
According to an article by the Thomson Reuters Foundation, Moldova has been struggling with rising energy prices over the last five years due to the country importing nearly three-quarters of its energy.
In order to address this issue, the country is teaming up with the United Nations Development Programme (UNDP) on a highly innovative initiative that will see one of Moldova’s universities fully powered by cryptocurrency-funded solar power, the article reports.
So how does it work?
UNDP will work together with South African solar power giant Sun Exchange to bring energy to live at the Technical University of Moldova based in the capital Chisinau.
Through crowdfunding people are able to buy solar cells of Sun Exchange, which they can then lease out to the university (and other public or private buildings in Moldova). When the solar cells are put to use, and the university starts producing energy, all solar cells owner will receive SolarCoins – which is a cryptocurrency started by blockchain start-up ElectriCChai.
It will take all the solar cells to be purchased before buildings such as the university can start to pay rent for them. There will be a charge – like any form of energy supply – for every unit of energy generated. The charge includes costs like installation, equipment and maintenance of the solar panels for up to 20 years.
The Technical University will get 1 megawatt of energy installed this summer due to the crowd-funding efforts, which will be powered across a 15000 square metres installation on the university’s roof.
According to the Reuters report, solar cells owners could expect to gain about four percent interest on their investments.
Energy and cryptocurrency
This is a beautiful coming together of cryptocurrency and renewable energy. One of the biggest challenges of renewable energy is the financing behind it and with the rising popularity of cryptocurrency and blockchain technology, financing could be made easier as all transactions will be tracked but there is no longer a need for the middleman.
It will not only mean cleaner energy provision for Moldova but also could help towards the country being less reliant on the import of oil and gas.
For the cryptocurrency passionate there is hope that the energy sector will continue to embrace the use of digital coins all over the world as the convergence of both sectors could reduce cost and increase the use of renewable power.
There is still a long way to go but a pilot such as in Moldova will be closely watched by energy developers, especially in the developing world.
If successful, UNDP plans on replicating the SolarCoin pilot in other countries in the Eastern Europe and Central Asia region.