The company doing this, LO3 Energy, is installing one piece of hardware - a "Tag Element" - next to a participant's existing energy meter.
The Tag measures how much excess electricity a PV/Solar panel generates.
The Tag sends that information on LO3's blockchain ("Transactive Platform") - essentially crediting whoever produced the electricity, and giving another participant the option to buy this "excess energy" directly from the PV/solar installation.
The end result is that someone can feel like they've bought the exact electrons from the participant with the PV/solar installation, while in reality, they've just bought some more energy from the grid.
I'm not sure how the pricing scheme operates, and if there are different prices for dirty grid energy vs renewable neighbor microgrid energy.
https://www.youtube.com/watch?v=oLsKQfjbYNg
I'm also not sure how or why the project is marketing that this grid could withstand a power outage or extreme weather as they are not installing direct physical lines between the PV/Solar producers and other microgrid users. Presumably the entire system would go down if the main utility went down - the PV/Solar guys could power their own homes, but there would be no way to get that electricity to other consumers.
This is the same idea as Google and Facebook signing power purchase agreements with wind or solar farms. Goog/FB of course get their power from the grid and not a direct link to the wind/solar farm, but by creating the financial instrument of the PPA (typically at a higher than market price) they allow the producer to finance their project which can make the difference between it being built or not. It's a lot easier to finance a project when someone has committed to buy all your power at a fixed price for 20 years vs the uncertainty involved in the spot power market.
* this is true even at a conceptual level without getting into the physics of how electrons don't actually get transmitted from a power plant all the way to your house
As a rule, anytime "blockchain" shows up someplace where it makes no sense someone is pulling a scam somewhere.
Also if LO3s customers are just buying from the grid, are they paying LO3 on top of what they pay their utility? If so what is the value added by LO3 at all?
This has to be built by someone, and then that has to be trusted. I can't imagine many people wanting to do such a thing on any side...
While it's entirely possible that the blockchain serves no functional purpose in this case that couldn't be done equally well with a web server, it's also possible that they've structured the company so that some parts are done automatically, by a smart contract on the blockchain, resulting in the company having less control than it would otherwise have.
Scepticism is a good thing. Making serious allegations based solely on speculation is not.
Not that I'm an expert in electrical grids, but I'd rather the actual grid coordinate a changeover to renewable sources, because these actors just sound like they're selling a scam that'll end with a class-action lawsuit someday.
(2) The market is peer-to-peer, so prices for buying and selling aren't dictated by a monopoly and monopsony power which could ripoff both the regular homeowners and solar-panel owners, but rather a competitive market.
(3) The grid is p2p and thus is disaster-resilient. Think back to Hurricane Sandy and the 2003 NY State blackout.
https://drive.google.com/a/stromdao.com/file/d/0B0DEak0BnhBf...
Actually, it kind of sounds like all this company is doing is being a middle man to collect money from customers who want to feel green without adding any value.
(I may have this completely wrong, I am genuinely curious how this makes sense though.)