Megawatt Hour Token

A tokenization of Renewable Energy Credits integrated with our IoT plataform that tracks energy production in Renewable Power Plants and their Consumers.

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Inspiration

Over the last ten years, the Brazilian energy market has been growing due to the expansion of Distributed Energy Resources projects and the evolution of regulatory rules that our National Electrical Energy Agency (ANEEL) is promoting. Nowadays, consumers have the right to produce their own renewable energy and export it to the energy grid in a system called the Electric Energy Compensation System, where producers can export energy to the grid in a net metering scheme that converts the energy exported in energy credits and allows the sharing of energy credits with other consumers who receive these credits on the energy bill and offset the energy consumed so that these credits are converted into a discount on their energy bills. This sector is called Distributed Generation in Brazil and is promoting a 3D trend in the Brazilian energy industry – Decarbonization, Decentralization and Digitization. More recently, in 2022, the Brazilian government published laws on cryptoassets in which it began to allow the tokenization of real-world assets (RWA) and thus opened new opportunities in several sectors of the economy. In the distributed energy sector, one of the opportunities is the possibility of transforming energy credits into tokens, where small renewable energy plants can digitize their clean energy production and sell the tokens directly to consumers who wish to obtain discounts on their energy bills.

About us

We are from an IoT distributed energy asset management startup that uses smart meters to monitor clean energy production and allows producers to connect with consumers in real time to trade and share renewable energy credits.

Our platform uses cloud computing to acquire energy data from those smart meters, process and store this data on the production of exported clean energy (Renewable Energy Plants) to the power grid and on energy use in consumers that have a clean energy share contract. This plataform is called as NetZer0 Energy Cloud because another important goal is to monitore and register Scope 2 carbon offsets in a hourly based scheme where consumers claim and evidence their Carbon Neutralization.

The Project

Our objective with the tokenization Project is creating a way for renewable power plants to tokenize their production (energy credits) and allow energy consumers to use those tokens in their energy bills. Using our ERC-20 smart contract “MegawattHours (MWh)” an energy plant owner can request the mint of tokens from their production, the contract will use Chainlink Functions to request latest production data from our plataform (netzero.app.br) and properly mint the tokens on the power plant wallet. Consumers can sign up their wallet to allow us to burn their MWh tokens in exchange to an equivalent discount in their energy bill. This allows producers and consumers to freely trade energy credits without the need of a production share contract. Brazilian laws states that energy credits have an expiration date of 5 years after their emition, so our smart contrat emits an time-to-live on our ERC-20 token, implemented as a linked list that organizes tokens from older to newer. The contract have a month variable, that tells how many months have passed since contract implementation, so once minted the token can be transfered and used up to the next 60 months. Through Chainlink Automations the month variable is incremented each 1st day of the month and every token that has a time-to-live lower than current month will no longer account for wallet balance, can no longer be traded or used and will be auto-burned on the next operation of it’s owner wallet. Transfer and burn operations will prioritize the older tokens.

Challenges we ran into

We're a small team that never developed a Smart Contract before, and we had a lot of conflicting schedulles.

Accomplishments that we're proud of

The linked list and expiration system are neat!

What we learned

A lot of Solidity constraints, specially about memory allocation, arrays and mappings.

What's next for Megawatt Hour Token

We still have features to polish on our contract and make an User Interface on our plataform. Also we are looking for legal advice to properly implement this Token with power distribution company and regulatory agencies acceptance.

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