Japanese Power Utility Experimenting With Bitcoin Micropayments

The third biggest provider of electricity in Japan, Chubu Electric Power, is conducting a trial of a Bitcoin payments technology. The power provider is partnering with Nayuta, a startup focusing on Internet of Things and bitcoin, to explore how to make virtual currency payments through the Lightning Network. This will offer customers of the electricity provider new and cheaper ways of paying to have an electric vehicle charged.

A demonstration revealed that the technology could be used to turn on a charger for electric vehicles once payment was sent. According to a senior Chubu Electric Power executive, Hidehiro Ichikawa, it is not clear when the technology would be rolled out to customers. However the senior executive disclosed that the test was part of the efforts the firm was making with a view to finding out how virtual currencies could be used with regards to Internet of Things.

Chubu Electric Power had been conducting tests with regards to using Bitcoin with Internet of Things for quite some time but realized that transaction costs are not as low as advertised. That is why the utility firm has turned to Lightning Network which promises to cut the costs. The Japanese utility currently possesses over 200 facilities for power generation and has more than 15,000 employees.

According to the chief executive officer of Chubu Electric Power, Kenichi Kurimoto, there was a growing interest by enterprises with regards to using cryptocurrencies in delivering Internet of Things payments fast and cost-effectively. In this regard Kurimoto believes that second layer payments offer the perfect solution.

Besides Nayuta and Chubu other firms that took part in the project include Infoteria, a Japanese software startup. Infoteria developed an application which relayed signals to the charger over Bluetooth or Wi-Fi in order to turn on the charger. No real Bitcoins were used by the firms as they preferred dummy virtual currencies as they had more control of these. The test however turned out to be a success and was a demonstration that micropayments can be made over the Lightning network instantly. According to a spokesperson for Nayuta, Hitomi Moriyama, the project had demonstrated that it was possible to apply the technology in paying for parking.

The spokesperson added that the startup was concentrating on ensuring that its software achieved compatibility with three other implementations of the Lightning Network. The three teams working on the Lightning Network include Lightning Labs, Blockstream and ACINQ.