Decentralised energy retailer Energy2market GmbH (e2m) has partnered with blockchain-based clean energy incentive Swytch to pilot an integrated clean energy and blockchain technology initiative in Germany.

The pilot will include 3.5GW of solar, wind, hydro and biogas capacity, enough to power 500,000 households, sold via a blockchain platform.

Swytch will use the trial to test its first versions of data flow, dashboard, estimators, token allocation models and other key parts of the blockchain platform.

The firm will use smart meter and blockchain data to reward both consumers and prosumers for reducing carbon emissions through energy use reduction and clean energy generation, respectively.

By producing clean energy, generators will create Swytch tokens. The blockchain solution will use artificial intelligence and machine learning to trace carbon emission levels emitted and avoided.

Andreas Keil, CEO of Energy2market, commented: "We firmly believe that blockchain technology can be used to unlock long-term value for Europe's renewable energy assets.

"Today, renewable energy represents 32% of the total energy market in Germany, but we have a goal of reaching 70% by 2050. Government-based incentive programmes can only do so much, and a more dynamic option is needed. Additionally, some countries, like Germany, will begin phasing out their incentive programmes in the next few years. We need to prepare for the future and identify new subsidy instruments and trading mechanisms."

"Just as blockchain is applicable to supply chain management and verification of physical assets, it is also beneficial for recording and tracking environmental attributions," said Evan Caron, co-founder and managing director of Swytch. "When compared to existing programmes this will drastically reduce fraud and administrative costs as well as open up incentive mechanisms to residential properties, which are the key to accelerated adoption of renewables."