Crypto AI Series: DeGEN
Decentralized Generative Energy Networks
It’s the 59th edition of The Gems Corner, and we’ll continue the series on Crypto AI. This issue will focus on the rise of decentralized generative energy networks and other alphas.
The traditional power grid, characterized by large, centralized power plants and long transmission lines, has been the backbone of our electricity supply for over a century. However, as we move deeper into the 21st century, this model is showing its age.
The challenges posed by climate change, increasing energy demand, and the need for resilient infrastructure are pushing us towards a new paradigm. This approach promises not only to modernize our energy systems but also to make them more sustainable, resilient, and adaptable to future needs.
What Does It Mean to Decentralize the Power Grid?
Decentralizing the power grid refers to shifting from a centralized model—where a few large power plants generate electricity, which is then transmitted over long distances—to a decentralized model.
In a decentralized grid, power generation occurs at multiple smaller sources spread across various locations. They are facilitated by Distributed Energy Resources (DERs) like rooftop solar panels, small wind turbines, community microgrids, and other localized renewable energy systems.
In 2023, the US solar market installed 32.4 GWdc of capacity, a remarkable 51% increase from 2022. This was the industry’s biggest year by far, exceeding 30 GWdc of capacity for the first time.
This decentralized approach allows for power generation closer to where it is consumed, reducing transmission losses, enhancing reliability, and providing opportunities for communities to produce their energy.
The above image shows that Solar is on track to produce “more electricity than all the world’s nuclear power plants in 2026, than its wind turbines in 2027, than its damns in 2028, its gas-fired power plants in 2030 and its coal-fired ones in 2032”.
The Rise of DeGEN
DeGEN is an acronym for Decentralized Generative Energy Networks coined by Guy Wuollet of a16z. DeGEN addresses this coordination challenge by leveraging the power of on-chain economies.
By introducing a new currency to finance distributed energy upgrades and linking the ability to read and control these devices to a unified open-source protocol, it resolve the coordination issue and supports the expansion of distributed energy resources.
Some fast-emerging DeGEN projects
Daylight Energy: Helps manage your devices, engage with Daylight, and earn rewards.
Glow Foundation: They’re creating and selling carbon credits from new solar farms by incentivizing renewable energy buildout. Plus, they recently topped the charts as the No. 1 revenue-generating DePIN project.
Srcful: They enable homeowners to engage in energy transition and be rewarded for their contributions.
Plural Energy: Allows you to invest in solar projects to profit from sunshine
EnergyWeb: They’re powering decarbonization solutions, enabling cleaner energy for a sustainable future
The Path Forward: Embracing a Decentralized Energy Future
The rise of DeGEN represents a fundamental shift in how we think about and manage energy. It aligns with global sustainability goals, enhances resilience, and empowers consumers.
As we move forward, collaboration between governments, protocols, and communities will be essential to overcome possible challenges and realize the full potential of decentralized power systems.
The DeDEN narrative is still in its early phase - am expecting to see more traction the narrative matures.
Alpha Bites and Tweets
That’s a wrap.
Thanks for reading!
Viktor DeFi.
PS: I’d love to hear your feedback and comments.