Australian blockchain startup Power Ledger unveiled a plan to test a peer-to-peer solar energy trading platform in the Indian state of Uttar Pradesh on Thursday.

The pilot project, drafted by utility company UP Power Corporation Limited and the state’s New and Renewable Energy Development Agency, is aimed to enable households with solar panels on their rooftops to trade energy with their neighbors via a blockchain platform, the firm said.

Power Ledger has joined India Smart Grid Forum (ISGF), a public-private partnership with the Indian government, which will lead the project.

“We're working directly with the government and state utilities to trial a blockchain solution in the Indian energy market,” Jemma Green, co-founder of Power Ledger, told CoinDesk. "We're gaining momentum globally with the ISGF pilot project in the biggest state in India.”

The first phase of the pilot is expected to be completed in March 2020.

“These results will help shape regulations and the future marketplace to roll out P2P solar energy trading across the state of Uttar Pradesh," Green said.

According to Reena Suri, executive director of ISGF, households will be able to set prices, track energy trades and settle surplus solar energy transactions in real time through smart contracts executed on a blockchain. That's made possible by smart meter systems integrated with Power Ledger’s platform.

"Once the scoping, planning and site selection has been completed and smart-metering infrastructure deployed, Power Ledger will commence the configuration and finalise trading logics for deployments of dynamic pricing Xgrid P2P energy trading platform in consultation with all the key stakeholders." Green said.

The move comes amid India’s effort to promote blockchain technologies, as well to curb fossil fuel dependence by increasing its capacity to generate solar energy.

On the same day Power Ledger announced the pilot project, Minister of State for Electronics and IT Sanjay Dhotre said the government is preparing a National Level Blockchain Framework.

The new framework will discuss the potential for distributed ledger technology and the need for a shared infrastructure for different use cases, Dhotre said in a letter to address questions related to blockchain research and adoptions from the lower house of the Indian parliament.

Meanwhile, the pilot project also reflects India’s efforts to decrease the use of energy generated by fossil fuel.

According to a report from the National Institution for Transforming India, it explores the financing requirements and business models to deploy 40 gigawatts of rooftop solar by 2022 as part of the government’s effort to generate 175 GW in renewable energy by the same year.

Formed in 2016, Power Ledger hopes to commercialize its blockchain technologies by offering an energy trading platform. In October 2017, the firm raised $23 million through a token sale to develop its software, according to its website.

Power Ledger also secured $1.69 million from the Australian government to participate in a "smart cities" trial in the Western Australian city of Fremantle.

The firm’s platform is based on a proof-of-authority network and has its own ethereum-based ERC-20 token, POWR.

"Power Ledger is continuing to scale our platform within Australia and internationally, growing our technology in the NEM to help energy retailers gain access to a more efficient way of transferring energy through the existing grid infrastructure.” Green said.