Many people want to use green energy but face practical obstacles, from lacking the physical space or property rights to install solar panels, or enough capital to invest in meaningful, large-scale renewable energy projects.
To address these challenges, Enel, the largest private electricity distribution company globally, introduced an innovative approach to green energy infrastructure ownership in Italy. The company sought to make sustainable energy far more accessible to ordinary citizens. Through collaboration with fintech solutions provider Conio, Enel developed a product for the fractional ownership of solar panels and wind farms on the Algorand blockchain, packaged as the ebitts program for its customers.
“There are complex systems at play in this product. But the great thing is that using a blockchain, you are able to limit the interaction with legacy systems, which is a thing that is sometimes overlooked, but it's a major advantage of working with tokenization… With the tokenization framework, you are able to do things that would be almost impossible to do with legacy systems.”
- Christian Miccoli, CEO and Founder, Conio
Enel and Conio's collaboration began in February 2024. Conio's experience with tokenization and strong regulatory compliance record made them an ideal partner for Enel's renewable energy initiative.
The ebitts solution uses the Algorand blockchain to enable fractional ownership of solar and wind farms. The project is set up with two different tokens – colloquially named “Energy Utility Tokens” – on Algorand. The first represents ownership of the power-producing infrastructure; when you buy in, you receive tokens that show exactly how much of the solar or wind farm you own and how much energy is expected to offset from your usage. The second token tracks the power your asset produces. Every hour, the system checks how much electricity your portion generated and sends you tokens to represent that power.
Behind the scenes, oracles connect the power plants to the blockchain. These oracles take information from the plant’s power meters and record it onto the Algorand blockchain, so everyone can see exactly how much power is being made. For example, if your portion of a solar farm generates 2 kilowatt-hours of energy, you will automatically get tokens reflecting that exact amount.
Key benefits
- Rather than installing personal solar panels, users invest in professionally managed industrial-scale facilities, that work for them as a virtual power plant. This approach eliminates maintenance concerns, provides insurance coverage, and benefits from economies of scale.
- The system tracks how much energy users’ tokens produce each hour. If they produce more power than they use, Enel gives the user credit for that extra energy.
- The automation of instant, on-chain token transfers (with tokens reflecting the amount of energy generated by a users' share in a solar or wind farm) creates a clear, immutable record.
Algorand proved ideal for this product for several reasons: its track record of zero downtime, support for regulated, MiCA-compliant Euro tokens, and carbon-neutral footprint, which aligned with Enel's sustainability goals.
How they built it
The project is set up with two different tokens – colloquially named “Energy Utility Tokens” – on Algorand. These tokens are created using Algorand Standard Assets (ASAs), which simplify asset representation.
Algorand Standard Assets (ASAs) are a powerful tokenization framework at layer 1 that can be used to mint fungible and non-fungible tokens. ASA are customizable assets that benefit from the same security, compatibility, speed, and ease of use as the Algo. ASAs allow issuers to define and manage tokens with custom features, such as whitelisting, asset freeze and revoke, and asset role-based access control (RBAC). These assets can represent anything, such as real-world assets, stablecoins, tickets, in-game items, and loyalty points. Unlike other blockchains that rely on smart contracts to create tokens, ASAs are a built-in layer-1 feature, they are declaratively created, making them simpler and faster to create without potential bugs. Learn more: Algorand layer-1 features