Saudi Arabia’s Energy Sector Prepares to Embrace Blockchain Technology
While there has been growing global interest in blockchain technology, very few actual use cases exist right now. That is only normal, as such ventures require a lot of research and development before they can be brought to market. In Saudi Arabia, a new venture is underway to disrupt the energy sector as we know it today. Blockchain technology and smart contracts are of great interest in this regard.
Although smart contracts traditionally work best with data already on the blockchain, there have been some big developments in this area. Zap, for example, allows real-world events and data to be used to trigger specific smart contract-based actions. This could open up a lot of new business opportunities, including the trading of energy in a peer-to-peer fashion.
As it turns out, there are many ways to achieve that. The energy sector has taken notice of these smart contract-related developments and has begun actively experimenting with some of the possibilities. Peer-to-peer trading of energy will not only reduce overall costs, but it will also remove a lot of administrative work from the equation. Whether it is electricity, oil, gas, or any other form of energy, the industry can benefit from decentralized technology in one way or another.
Earlier this week, Saudi Arabia’s first-ever blockchain event took place. Riyadh, the capital city, hosted the Decoding Blockchain conference. Disrupting the energy sector was a big topic during this event. Even national petroleum giant Aramco made it clear they are experimenting with blockchain technology for various reasons. In their opinion, the “next generation of smart contracts” will play a big role in the future of Saudi Arabia’s energy market.
As mentioned earlier, Zap is quietly making a lot of progress on blockchain tech and smart contracts. Its new energy venture, known as EnergyLedger, has the objective of ensuring that contractors are paid for their exact work, as they do it, without unnecessary transaction processing fees. Instant settlement of transactions and a reduction in human error are some of the project’s key benefits.
While it is good to see such ventures being developed, it remains up to energy giants to embrace this new option. Decentralization and peer-to-peer trading are not necessarily of great benefit to companies which have monopolies on particular aspects of the energy industry. Even so, change is coming to this industry, whether companies want it or not. Embracing the blockchain may very well become an absolute necessity in order to remain competitive.