Blockchain and the applications of distributed ledger technologies are rapidly gaining ground across industries.
Currently, utilities blockchain applications can be considered in two broad categories: “near-term” and “emerging.” “Near-term” applications target potential value in two to five years, often targeting operational savings via optimization of existing transactions. One example would be supply chain optimization, where applicability of blockchain solutions across industries may lead to earlier feasibility for utilities. On the other hand, “emerging” applications target potential value in five to 10 years, often via the creation of entirely new transactions, markets and revenue streams. An example would be peer-to-peer energy trading on blockchain, allowing individuals to buy and sell electricity to and from their neighbors. Striking a strategic balance between pursuit of these two categories will be critical for utilities to consider.
While these blockchain applications do promise to unlock value for the utilities industry, it will not happen overnight. The technologies, business models, and regulatory frameworks are all still maturing, and challenges must be addressed before blockchain is ready for deployment at scale. However, this does not mean the right answer is to sit back and wait.
Utilities should take action now in order to prepare themselves to execute on the opportunities afforded by blockchain technology. Accenture believes that utilities should:
- Define a coordinated, organization-wide blockchain strategy for near-term and emerging applications.
- Select and test proof-of-concept and pilot applications judiciously, based on specific business needs and measurable outcomes.
- Utilize pilot applications to determine enterprise IT architecture and integration requirements should blockchain applications accelerate.
- Proactively collaborate to help shape standards and rules of engagement for blockchain ecosystems.