Connected cars, chargers, and grids driven by machine-to-machine (M2M) interactions will be ubiquitous in the streets of tomorrow’s cities. Today, Jaguar is partnering with IOTA to offer prototype cars that come with a built-in smart wallet connected to a distributed ledger technology (DLT), specific to IOTA, dubbed the Tangle. This feature enables a multitude of practical and user-free applications — from reporting potholes to local authorities (and receiving a payment in return) to paying for parking, tolls, and electric vehicle (EV) charging.

As you will come to see, these features will also help manage the energy demand of a smart city. The technologies that enable these interactions include a smart self-balancing grid and the IOTA Tangle in a data-sharing economy.

Untangling Tangle

Whereas other crypto assets such as Ethereum and Bitcoin utilize blockchain as their platform, IOTA is specially designed for the Tangle data structure. Unlike a blockchain, the Tangle uses a directed acyclic graph (DAG), which allows for multiple chains of blocks to interconnect, making it a scalable option and thus a solution we can implement for the grid. Better yet, unlike most other DLTs, it is free to use.

One negative, however, is that the system is slow unless many people connect to it.

Lastly, the peer-to-peer, decentralized Tangle is optimized for the Internet of Things (IoT) environment, and the IOTA crypto asset was specifically designed and intended for IoT, making it the ideal ecosystem for a smart city.

IOTA is also a key part of Jaguar’s vision for the future of its cars, which can communicate with the grid on their own. Jaguar has built prototypes of vehicles (such as Jaguar F-Pace) that are equipped with an IOTA integrated smart wallet, enabling the car to exchange information, earn money, and make micropayments for services.

As Lewis Freiberg, the director of Ecosystem at the IOTA Foundation, puts it: “We want to standardize things so everyone can understand and interact with each other. The ideal scenario is we… live in a world where everything can talk to everything else, purchase services, and are more efficient by having one device rather than five doing the same thing.”

Once you plug in your car and add your wallet address, the car will exchange tokens for the electricity by itself — no human interaction is necessary. The process is transparent because meter data is stored on the Tangle and is easily accessible to customers through a built-in user interface.

The Necessity of Smart Grids

DLTs — which are an important part of the smart grids containing smart chargers, vehicles, and homes that can communicate with each other — will help us manage our appetite for large quantities of immediate energy. Solar and wind energy are beginning to represent a larger slice of the electricity pie, but there are only specific times when these energy sources are available. Storing energy for peak hours, especially in the evening (highest demand) and at night when the sun isn’t shining, is an issue that needs to be addressed.

Luckily, smart grids can offer part of the solution. A grid has a transformer that is tasked with supplying energy, with one feeding cable and multiple outgoing cables (to homes, vehicles, and chargers).

Photo byElaad

A self-balancing grid sends and receives information from the vehicles, homes, and chargers. The grid recognizes when energy is running short. It then informs, for example, a charger that is currently charging a vehicle and asks if it can reduce its energy use. The charger informs the car of this request.

Of course, the vehicle can ignore the request and complete its charge. This is where IOTA tokens come in. They provide an incentive to help the community manage its energy needs. Specifically, if the car is already charged enough, it can decide to transfer energy back to the grid (prosumer model), or the car can simply receive less electricity and be awarded IOTA tokens in exchange. The IOTA tokens are then deposited directly into the smart wallet.

By using a self-balancing grid we can create a self sustainable island that will maintain its capacity. These ecosystems can even be made further resilient in the face of power outages if multiple islands are linked to one another. In this way, a self-balancing grid can spread the use of energy more evenly throughout the day. This will help us avoid spending money to update our infrastructure just to handle a 60-minute peak energy use period, which occurs in the evenings.

Looking Under the Hood

In a recent proof-of-concept (POC), a team of developers built a sample of how a smart grid would work in practice. All the code used in the sample is based on JavaScript because IOTA’s JavaScript library, which allows for creating transactions, signing transactions, generating addresses, and interacting with an IOTA Reference Implementation (IRI) node, is the most developed library. The POC consists of a back end and five front ends.

The back end is written using the Node.js environment and it virtually represents the role of a transformer in a grid. The transformer gathers data in an effort to monitor the load and threshold on the grid. Then, every 30 seconds, the meter value is compiled into a JSON file and attached to the IOTA tangle.

The front ends are written using the Electron framework and consist of the following five parts:

  • A UI logic thread, responsible for updating graphs and values.
  • A main thread tasked with communication and basic setup.
  • A second thread tasked with IOTA communication and function execution.
  • The Chart.js library for the graphs.
  • Bootstrap components for the UI.

As a developer, you might wonder why there are two separate threads for communication. This is largely due to the fact that the IOTA communication and function executions have a high processing demand and because the code is running on a Raspberry Pi. Raspberry Pi has relatively low processing power, so it is necessary to reduce the load on the device and make sure it doesn’t overheat in the process. In a device with more processing power, such as a desktop computer, the two can be merged.


The IoT and M2M interactions are becoming more widespread. Many new ideas and applications for how we can utilize these technologies surface daily as we transition to Freiberg’s vision of tomorrow. Developers who can work with the DAG, understand its applications, and tackle the code behind these technologies are necessary to make this transition happen.

A working sample of the charging aspect using the IOTA Crypto Asset has been implemented. Gaining an in-depth understanding of how these technologies work will give you an edge as they begin to be implemented more frequently. Why not try it out for yourself? Perhaps you can add a battery (or even a household) to the equation!

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