Analysis of Decentralized Energy Transactions Based on Smart Contract

Abstract

The recent burgeon of decentralized techniques has highlighted peer-to-peer transactions. And the high degree of trading freedom and efficiency in peer-to-peer transactions has facilitated the implementation to allocate energy in power systems. During attempts to apply blockchain in energy trading, researchers found Smart Contract, an essential function of blockchain, beneficial to the energy trading efficiency, besides the ability of keeping trading data tamper-resistant. To analyze the feasibility, validity and advantages of methods to accomplish decentralized energy transactions based on Smart Contract, we presented a basic model to illustrate the principle of how to use Smart Contract in energy trading at first. Then, we summarized three typical methods with diverse characteristics, including Independent Negotiation, Pre-distributing Strategy, and Smart Contract Processing. Besides, we designed one trading example based on the Pre-distributing Strategy, with the application scenario of Virtual Power Plant in power systems. The trading result showed that proper adaptions of the method can satisfy some requirements such as reducing the pollution emission.