- SolarCoin is a blockchain-based technology that rewards people who use solar energy.
- The users are rewarded with 1 SolarCoin for 1MWh of energy.
There are $2 Trillion worth of cryptocurrencies in the market now and this sector continues to rise as more people join the alluring blockchain ecosystem. However, people may be surprised to learn that most of these cryptocurrencies were mined using large computational efforts making it an energy-intensive process. The Proof-of-Work consensus, on which the earlier coins such as Bitcoin were based, asked miners to solve a hard cryptographic problem to earn one.
In the beginning, when the network was new and only a few people mined coins, the hash rate was lower and required less work. However, as the popularity grew and people saw the opportunity, mining turned into a business with people competing with each other for Bitcoins by introducing even more powerful computers, utilizing greater energy than before. This led to serious impacts on the environment.
What Is SolarCoin?
People still depend on exhaustible sources of energy like coal and crude oil products for most of their energy requirements. Although many are mindful of the rising need to use renewable resources, the percentage is still limited. One way to attract people to use renewable sources of energy is by rewarding them.
SolarCoin is a blockchain-based solution for rewarding people who install solar plants and use solar energy for their needs. It was launched in January 2014, with a single mission for the next 40 years, to reward generators and incentivize solar electricity production.
How Does it Work?
The steps to keep in mind while using SolarCoin are as follows:
- Solar plant owners have to register themselves with the SolarCoin foundation. This can be done by visiting the official website, registered affiliate, or monitoring platform.
- The registration process includes producing documents of ownership of the plant, grid connection, power production data (meter readings), and KYC.
- Once registered successfully, the owner receives coins at the rate of 1 SolarCoin per 1MWh of electricity in their SolarCoin wallet or any other Ethereum-compatible wallet like Metamask, every 6 months.
- The total supply of coins is 97.5 Billion which will support till 2050. The granting is ex-post facto from January 1st, 2010.
Scope of SolarCoin
Investors investing in solar plants make their calculations based on the capital cost for installation and the price they would get after selling the generated electricity. SolarCoins are added to it, which the owner can choose to save or exchange with fiat currency or other cryptocurrencies. As the project invites more people and the value of the coin increases over time, they will consider this prospect in making their financial decision.
- Government
The national and sub-national governments around the world already own many solar plants. With small-scale plants installed in schools, universities, and hospitals to large-scale ones, that power a whole town, government has access to it all. These plants combined produce thousands of MWs of energy and make the government worth thousands of SolarCoins.
Public administration bodies can also use them as a form of payment. They can ask for donations in SolarCoins while setting up solar projects in villages. Moreover, the inclusion of the government will remove the short-term speculation of the tokens, build trust among investors and establish a long-term value.
- International Organisations and NGOs
As cryptocurrencies are not defined by borders and have low transaction fees, they can be ideal for fundraising campaigns led by international organizations and NGOs around the world. They can also spread the word to their members and supporters regarding this solar support scheme and attract mass to this program.
Final Thoughts
SolarCoin was based on Proof-of-Work from Jan 2014 to Aug 2015 and shifted to the energy-efficient Proof-of-Stake from Aug 2015 onwards. When a user chooses to use SolarCoin as a currency, he brings environmental concerns to the base of economic activities. SolarCoin brings a myriad of opportunities with it by combining the crypto space with environmental awareness. It would be interesting to see how this coin will change the dynamics of the cryptocurrency by promoting the use of renewable sources of energy.
Dr. Naveen Singh is an entrepreneur with achievements in sports, academics, healthcare, innovation, blockchain technology, telecommunications, and philanthropy. He is the Co-Founder and Chief Executive Officer (CEO) of Inery, the first layer-1 blockchain programmed for database management. With Inery, he aligns with his vision of a new paradigm for data to empower web3 and complete decentralization.