The role of blockchain in the electric vehicle industry

Text/Naveen Joshi

Image source: Visual China

You may not see them coming, but the effects of climate change are already starting to be felt in some parts of the world. An example of this is the destruction of several coral reefs around the world in recent years. As devastating as it sounds, it is only a prelude to a long list of potentially catastrophic events. In the long run, climate change has the potential to eventually push humanity to extinction. So while small measures like planting more trees and turning off light bulbs when not in use are certainly useful, larger measures are needed to combat the devastating effects of climate change.

The internal combustion engine is one of the main causes of climate change – which contributes to carbon emissions. Such engines produce large amounts of nitrogen oxides, carbon monoxide and other hydrocarbons that can harm the environment and cause personal respiratory disorders. For these reasons and many more, electric vehicles need to replace traditional internal combustion engine vehicles.

Electric vehicle owners can save about $700 a year on fuel costs. In addition, the maintenance cost of electric vehicles is also lower than that of standard cars. Therefore, owning an electric car can help them save money and reduce their extreme dependence on fossil fuels, thereby slowing their inevitable consumption from the earth. In addition, electric vehicles are very efficient, consuming only about 25-40 kWh per 100 miles. On top of that, electric vehicles reduced carbon dioxide emissions by almost 178 million kilograms. What's more, despite their high fuel efficiency and small carbon footprint, electric vehicles can easily outperform traditional internal combustion engine vehicles.

Several countries around the world have set specific targets that, in the coming years, will stop producing internal combustion engine cars and only electric ones to reduce their carbon footprint. For example, the U.S. plans to achieve net zero carbon emissions by 2050 by stopping sales of gasoline-powered vehicles by 2035.

Blockchain already has several use cases in the automotive industry. In the future, it's safe to say that most cars will be electric, so these use cases will also apply to the ev industry. The use of blockchain to facilitate the operation of electric vehicles will promote the development of the electric vehicle industry.

Owning an electric car is a challenging thing for a number of reasons – the scarcity of charging interfaces and the high purchase price of cars are the main reasons. The use of blockchain in EV operations can overcome these problems.

Reduce production costs

Blockchain-based applications have traceability capabilities. This feature allows EV manufacturers to keep a close eye on materials when producing. Certain types of materials, such as black tungstenite and cobalt, come from developed countries that are difficult to trace. These materials change hands several times before they are sent to factories for processing and production. Therefore, blockchain is useful for accurately storing detailed information related to the origin of raw materials, so that manipulation of raw materials from these sources can be prevented. The use of blockchain in EV production could also enable manufacturers to monitor any transfers as materials enter factories to produce EVs. Blockchain tracking technology allows electric vehicle manufacturers to respond to car recalls in a cost-effective manner. If there are any material issues that require a recall of a vehicle, manufacturers can only recall electric vehicles that are manufactured using parts or materials from suppliers. This will make your supply chain leaner and more cost-effective. A leaner supply chain could reduce production costs for EV manufacturers.

This is how blockchain reduces the cost of production, which in turn reduces the cost of purchasing electric vehicles.

Promote electricity trading

As mentioned above, one of the main challenges of owning an electric car is that it is difficult for car owners to find a charging port to drive their car. At least in this day and age, electric vehicle charging ports are not as ubiquitous and convenient as gasoline or diesel pumps. Ev owners tend to live in a constant worry that when commuting long distances, they worry about running out of batteries because there are no charging stations nearby. Therefore, they must take into account the vehicle's power range, charging time and availability of the destination charging port when planning commute times. This is a huge limitation, as it slows the spread of electric vehicles worldwide and also causes many car owners to postpone the purchase of electric vehicles. If the government or businesses can solve this problem, the popularity of electric vehicles will be greatly accelerated. In order to solve the problem of charging port availability, the blockchain-based P2P electric vehicle charging concept can be adopted. This concept involves the use of blockchain to charge electric vehicles through electricity trading.

Owners of electric cars can have their own personal chargers to power their cars. Blockchain apps allow car owners to exchange electricity by sharing their private EV chargers with those who need them. With a dedicated digital P2P charging platform, users can open their chargers to the public when they are not using them. Examples of such blockchain EV charging platforms are Share & Charge, Chargemap, Aerovironment, Easy Park, and Charg. Ev owners who receive electricity from these individuals will pay cash through digital platforms. As a result, owners of electric cars can keep their cars going and if their batteries run out during their commute, they can look for available personal chargers nearby. Owners of private EV chargers can transact electricity through a secure blockchain platform, increasing the utility of idle chargers. As always, blockchain guarantees the security of both currency transactions and electricity transactions.

Blockchain participates in electric vehicle charging, increasing the number of charging locations. In addition, P2P EV charging does not require major investments, as existing infrastructure (which would otherwise be idle) is being utilized. Electric vehicle manufacturers that invest in such infrastructure can gain a direct competitive advantage over other automakers, as electric vehicles will be the norm in the future, not the exception. Tesla has invested heavily in electric vehicle charging infrastructure to increase the convenience of car owners.

In the future, smart cities can integrate such energy sharing platforms into smart grid systems. This integration will help manage electricity and deliver it to the areas where it is most needed. As we have seen, the use of blockchain in EV-based operations solves the most relevant issues associated with owning an EV. In this way, blockchain helps accelerate the global adoption of electric vehicles.

Prompted the creation of digital vehicle passports

Buyers of used electric vehicles need to know several details before finally deciding to buy. These details include details such as the number of miles traveled in a given vehicle, accident-related records, the frequency of repairs, the condition of the interior and batteries, the performance of its safety devices such as anti-lock braking systems (ABS), airbags, electronic braking force distribution (EBD), ramp-down control (HDC), electronic stability program (ESP), etc.

Blockchain-based applications enable used car suppliers to create a digital "passport" for each electric vehicle. This type of app allows buyers to verify the details listed above about any electric car on the used car market. They can even have third-party experts verify the details of a particular vehicle. All they have to do is scan the QR code on the seller's app with their own phones. Such an application would give potential used EV buyers access to expert-generated, verified used EV information. As with any blockchain-based tool, records in the application are secure and cannot be manipulated.

The public tends to associate blockchain and cryptocurrencies only. In fact, blockchain has multiple applications in healthcare, banking, insurance, supply chain management, and more. Blockchain-based applications have several standard characteristics — transparency, data security, and decentralization — that can be applied to different industries in a number of ways. In the case of the ev industry, blockchain-based applications make EV networks – and the data stored in them – super secure.

The EV industry can take advantage of all these blockchain idiosyncrasies to lower the price of manufactured cars, create an integrated, consumer-friendly charging infrastructure, and create accurate, proven "passports" for electric vehicles.

All in all, blockchain could allow governments, individuals, and businesses to adopt electric vehicles faster to mitigate climate change.

Naveen Joshi is a Forbes contributor and expresses opinions on behalf of individuals only.

Translated by Stephen