Alternative Finance for Decentralized Solar Microgrids

By Michael Casey

Achieving sustainable economic development for all requires the installation of large amounts of solar energy capacity in remote, off-grid, low-income areas. The problem is not the availability of photovoltaic technology; it's how to finance its adoption. In such places, local residents often have no credit scores and the legal and physical infrastructure for securing assets is unreliable. That leaves investors with no confidence in the collectibility of their loans or access to revenue, which makes financing such projects extremely expensive.

Digital currency and distributed ledgers may offer a solution. A DCI-led team is exploring using this technology to securitize transactions among local users and owners of blockchain-managed, decentralized solar microgrids. The goal is to create a secure form of reliable, executable collateral that's governed by a distributed computational architecture and that objectively protects the rights of both users and investors so as to lower risks and slash the costs of finance. 

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