Idea inspired by the challenges of the energy industry
Several years of experience in the energy sector and digitalization has led the founders of Enerhash to recognize the potential of production optimization with data centers. Power plants face strict market regulations beside an ever-intensifying competition, forcing energy producers to look for alternative solutions to optimize their production. In many cases, they need to schedule production meticulously on an hourly, minutely or even secondly basis to ensure profitability and competitiveness. The reason for this is that the market price of electricity is highly volatile. We have come across negative prices even recently. Such price levels make production unprofitable and result in plants having to turn operations on and off even several times a day. Such market conditions free up a significant amount of capacity of power generators.
At the same time, the huge demand for electricity of data centers is a major challenge in the blockchain industry. Supplying server parks with enormous concentrated energy needs with enough power has serious financial implications, especially in developed regions where the price of electricity tends to be higher.
Accurate modelling was critical to validate the idea
A long modelling process followed the recognition of the idea – to overcome the challenges of both industries at the same time. We received positive feedback from both server operators and energy producers who had already begun to look for alternative sales channels for their excess capacities. At this point, plants face another obstacle since on-site consumers usually demand 100% availability in contrast to server parks that sell virtual server capacity any time when they are in operation. This way, a data center does not only provide an additional source of revenue, but also extra flexibility in production.
Business modelling has highlighted the fact that scale is an important factor of profitable operation. We have designed a model that is built on institutional investment where a reliable legal environment, corporate and legal structuring is a must.. Previous experiences of the founders with larger corporations and their business strategies have proved to be critical in this process.
Enerhash conducted the first on-site tests at power plants in 2019, which was preceded by a year-long preparation. To this date, we have developed all adequate technological, tegal and economic frameworks for operation that are essential to make our business model scalable.
Our goals for the near future
Our mission is to map and maximize the value of excess capacities of energy producers globally. Optimizing power plant production with data centers is still considered to be an innovative solution, even though there are numerous international precedents demonstrating the benefits of investing in data centers. Enerhash aims at laying the cornerstone for the entire industry with an affordable and viable solution for both power plants and server owners.
Benefits of these synergies will also be made available by Enerhash to server owners in the form of affordable electricity prices, system management and maintenance services. In addition to additional flexibility, we thrive to improve our value proposition for power producers constantly, so that the DATABOX can serve as an alternative to energy storage units.
Our goals for 2020/21 include setting up a network of data centers with a consumption of more than 5 MW, which will enable server owners to enjoy profitability due to industrial rates. In addition, we aim to map an additional 40 MW of excess capacity by the end of 2021. In addition, we also consider the parallel development of stable, corporate operations to be of paramount importance. Through our activities, we want to set an example in the industry and encourage investment in data centers by having a framework in place for operation, infrastructure and technical background.