EnergyDAO - Decentralised Autonomous Organisation for energy community governance

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Energy access is liberty. Moreover, energy is a prerequisite for any secure society, and it is the most consumed product worldwide on a daily basis. As a fact, all democratic countries with the least corruption have annual per capita energy consumption of greater than 2 MWh. Moreover, many communities in the world have net energy imports which is one of the major expenses for communities. On one side, communities’ well-being is reflected by high energy use, on the other side, in poorer communities’ energy import cost is significant, and it impedes communities’ well-being. It can be described as a wealth leak problem. However, energy production comes with a cost, consumption of locally produced energy should be maximized to boost communities’ wealth and well-being.
Communities’ well-being amplification rides on the wheel of governance as a system of control and operation with an accountability mechanism. This brings sustainable benefits to its people within the confines of cultural context through collective decision-making. Technology adoption has continued to change the narration in human society lifecycle, such as the decentralized autonomous organizations (DAOs). DAOs are a type of legal structure-like platform that is purely digitally existing for decentralized rule-based decision-making; DAOs are built on block-chain technology, which enables secure and transparent bookkeeping and transaction processing. In the renewable energy community, DAOs can be used to improve the transparency of local energy management and community governance.
This white paper describes a new way of organizing renewable energy communities [a DAO entity; hereinafter EnergyDAO] by means of community-level joint ownership of energy infrastructure to help reduce the wealth leak in communities. The EnergyDAO allows community members to have ownership of local energy-producing and storage infrastructure. EnergyDAO allows communities to define a rule base for automatic, efficient, and democratic governance and decision-making to organize themselves in a transparent manner and create trust. Generally speaking, EnergyDAO is a bunch of smart contracts to denote a structure of ownership or control over EnergyDAO treasury and renewable energy assets/ infrastructure. This can include solar panels, windmills, battery storage, electric vehicles (EVs), etc. Moreover, such DAO-based governance can be used by already existing traditional energy cooperatives or by independent individuals working together collaboratively in any community to automate and enforce formal governance rules imposed by cooperate bylaws or law.
VTT proposes, through this white paper, that EnergyDAO-based communities can have enhanced member experience and solve transparency-related governance issues found in traditional cooperatives.
Original languageEnglish
PublisherVTT Technical Research Centre of Finland
Number of pages11
Publication statusPublished - 2 May 2023
MoE publication typeD4 Published development or research report or study

Publication series

SeriesVTT White Paper


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