The team behind Power Ledger, a peer-to-peer renewable energy marketplace that partly relies on Ethereum, is teaming up with the Indian state of Uttar Pradesh to pilot a P2P energy trading platform.

The province is notably home to more than 200 million citizens. Zooming out, the state government’s blockchain embrace comes as some of India’s top authorities continue to hash out the rules that will define the country’s future approach to blockchain and cryptocurrencies.

Joining Power Ledger in the pilot platform venture is Uttar Pradesh’s New and Renewable Energy Development Agency (UPNEDA) and the state’s utilities company UP Power Corporation Limited (UPPCL). The wider effort is being steered by the India Smart Grid Forum (ISGF), which is backed by the Indian government and which Power Ledger has joined accordingly.

The ultimate goal of the pilot? To allow Indians that have houses powered by solar energy to readily trade excess energy with nearby peers, all powered by blockchain. “Power Ledger’s platform integrates with smart meter systems to enable households to set prices, track energy trading in real time and enable the settlement of surplus solar transactions in real-time through smart contracts executed on blockchain,” ISGF Executive Director Reena Suri said. The collaboration, which is expected to see its first stage completed early next year comes as the Indian government has set its sights on building up 40 gigawatts (GW) of rooftop solar energy power throughout India in three years’ time.

What Comes Next in India?

Last February, Indian Prime Minister Narendra Modi said during a presentation before the World Congress on Information Technology that “disruptive technologies such as blockchain … will have a profound impact in the way we live and work.” Yet in India things have been testy for blockchain’s most popular innovation, cryptocurrencies, since Modi’s remarks.

In April 2018, Reserve Bank of India (RBI), the country’s central bank, blocked all domestic financial institutions under its jurisdiction from providing services to cryptocurrency businesses. Exchanges shuttered and in many cases Indian traders moved their assets to foreign exchanges.

Some Indian crypto supporters challenged the RBI’s ban in court, and the case rose all the way to the nation’s Supreme Court. In July 2018, the high court decided at the time not to overturn the central bank’s ban, arguing that RBI had jurisdiction to move against the industry because Indian law holds that the only permissible money in the country is government-backed money.

The legal showdown continued in the ensuing months, with several punts and delays stalling the process well into 2019. The grand result, however, seemed to be the fomenting of a strongly anti-crypto regulatory environment in India.

Back in January, a committee comprised of officials from top Indian government ministries relatedly entered the final stage of its work on creating new cryptocurrency industry regulatory recommendations. In June, a draft bill was also put forth in the country that, if passed, would divvy out 10-year prison sentences for anyone found to be using or mining cryptocurrencies.

Fast forward to last month, and the country’s Ministry of Electronics and Information Technology also confirmed it was in the process of finishing a comprehensive “National Level Blockchain Framework.” So new crypto and blockchain rules look near for the populous nation, but what their ultimate dictates will be remain to be seen.

Wherever the chips end up falling, the regulatory uncertainty hasn’t stopped regional authorities in the country from embracing experimental projects powered by blockchain innovations.

For example, the Indian state of Kerala began testing blockchain in a food supply chain solution last summer. Months later, the state of Karnataka started work on a blockchain-based intellectual property registry. In Uttar Pradesh, officials have previously moved to shift land revenue records onto blockchain.