by Cindy Huynh
Sun Exchange, a South African marketplace financing solar power via cryptocurrencies recently partnered with the United Nations Development Programme (UNDP) to power the Technical University of Moldova with cryptocurrency-funded solar energy.
The deal should meet most of the University’s energy requirements since the solar-powered rooftop installations would reach 15,000 square meters in surface area. The idea is to test the concept and eventually find new sources of finance to “help buildings go green overnight,” said Dumitru Vasilescu, a program manager of UNDP in Moldova.
Harnessing solar power with cryptocurrencies, however, has significant ramifications for the country. According to Reuters, Moldova is one of Europe’s poorest countries. It is currently a small, landlocked nation in Eastern Europe with an annual GDP per capita of $2,200. They import three-quarters of their energy. Unfortunately, energy prices have increased by more than half over the last five years.
Abraham Cambridge, the founder, and CEO of Sun Exchange believes that the solar cryptocurrency marketplace “has all the right incentives in place,” which will help Moldova finance renewable energies. “It reduces the cost of going solar dramatically for the end user and makes it easy for anyone in the world to own a solar cell anywhere in the world and, from it, make a steady source of sunlight-powered income.”
Cryptocurrencies Can Help Moldova Reduce Dependency on Energy Imports
“One of the biggest obstacles to countries investing in renewable energy is a lack of finance, as you often have to wait 10 to 15 years before you get a return on your investment.”
Sun Exchange’s new approach provides a solution to the lack of finance problem. With the installed solar panels, the University will receive 1 megawatt of energy in the summer. The owners of the solar cells can, therefore, receive SolarCoin as soon as Moldova’s University produces energy. They will own interest of about 4 percent of their investment. Furthermore, Moldova has over 10,000 square meters of empty rooftop space that could provide energy for the nation.
If Moldova decides to leverage cryptocurrency and blockchain technology, they could potentially reduce their nation’s dependency on energy imports like oil and gas from Russia. Darius Nassiry, a senior research associate at the Overseas Development Institute, mentioned that a lot of cryptocurrency-funded energy would be present in the developing world. “They have faster-growing energy needs…and a more accommodating legal and regulatory environment towards such innovations.”
If the Moldovan cryptocurrency-funded solar energy project proves successful, the UNDP will replicate it in neighboring countries. It could “revolutionize the renewable energy market for Eastern Europe and Central Asia,” said Vasilescu.
Moldova’s Stance on Cryptocurrencies and Blockchain Technology
The National Bank of Moldova (NMB) like most Central Banks have warned the general public about the risks of cryptocurrency investments. The NBM mentioned in February 2018, that:
“currently traded VCs, especially the Bitcoin, are not currencies in the common sense of the term. Thee are virtual assets without real cover or any guarantee of acceptance as a means of payment by the monetary authorities. Therefore, these assets are characterized by high price volatility and a low degree of security, as compared to the currencies issued by a Central bank or regulated electronic currencies.”
While Moldova appears bearish of bitcoin, they are bullish on the blockchain. A group of tech enthusiasts banded to create the Digital & Distributed Technology Moldova Association (DTMA) to leverage blockchain technology. The goal is to introduce blockchain-based projects to Moldova and use the country’s workforce to test international projects. In January 2018, the first cryptocurrency exchange with eight fiat pairing currencies launched in Moldova.