Is anyone ever happy with their electricity bills? Probably not: The prices keep growing every year, and most people do not understand why, nor how they can reduce their expenses. An innovative and comprehensive solution is required – such as the one provided by LCG Energy.
The average German household pays around 230 euros a month for electricity, petrol, and heating. However, only about 23% of this sum represents the actual costs and profit margin of the energy company. Another 21% us due to the renewable energy surcharge, and 23% more is charged for the use of the electric grid. The rest is divided between taxes and various fees. However, even the share of the energy company does not just cover the cost of purchasing power on the wholesale market: As soon as there is a new government requirement to reduce pollution or improve security, the resulting costs are passed on to consumers.
Is it possible to spend less?
What makes the energy cost problem particularly tricky to solve is that electricity bills in Europe and the US are still not so high as to be unaffordable for most households. Consumers are unhappy, but not unhappy enough to spend hours and days of their time looking for alternatives. Information asymmetry is at play here: Users do not know how much they consume (and they know even less about how much each appliance consumes) or what the real market price of energy is. Energy companies suffer from asymmetry, too: They know exactly how much energy costs, but they have to spend a lot of money to send meter readers to homes and offices to find out how much has been consumed. The result is a highly inefficient system of high estimates on bills that later have to be corrected.
Shouldn’t there be a way to know how much energy one is using in real time, together with the cost? Turns out there is – a blockchain-enabled smart grid.
Smart grids: the LCG approach
LCG Energy is an German energy reseller and contractor with its headquarters based in the Netherlands and serving over 50,000 customers across Europe, particularly in Germany and Austria. For the past 10 years, LCG has been helping both households and small businesses optimize their energy consumption. The effort has paid off: Now the company’s clients are saving on average 20% on their electricity bills. The savings are largely due to the use of smart meters – sensor-enhanced devices that take real-time readings and display the amount to be paid. No more estimates or monthly visits from meter-reading personnel: LCG bills reflect only what has been consumed. Furthermore, it is possible to use wholesale market prices to calculate how much one should pay.
The next step for LCG is to introduce blockchain into the equation. Blockchain technology is a great fit for the energy market, since it can connect consumers and energy producers directly without brokers or other intermediaries. This could not only reduce costs but also give smaller producers of renewable energy a chance to reach a wider audience. In a blockchain-based framework, energy sellers of all sizes can compete for clients’ attention, offering the best prices.
The LCG energy token
To ensure the uninterrupted functioning of its new energy ecosystem, LCG Energy will issue its own token. The company will use 80% of the proceeds from its token sale to purchase power on the wholesale market as well as invest in the most promising energy projects. As a result, LCG clients and token holders will benefit in several ways:
– saving money by using smart meter-enabled grids
– obtaining the best available prices
– making secure investments in projects with a high ROI