Blockchain-integrated Local Energy Market and P2P Trading Benefits for Participants and Stakeholders

Abstract

This paper presents a local energy market (LEM) model to conduct peer-to-peer (P2P) energy trading between a number of participants by dint of the Ethereum-based blockchain technology. The proposed LEM mechanism is structured by considering relevant functional constraints while energy trading is arranged between several participants in the presence of other stakeholders including energy retailer and network operator. LEM participants’ mutual bidding intended P2P trading, actual settlement, and final billing are executed using the smart contracts in Ethereum blockchain to record LEM transactions and related data in an unchangeable and distributed fashion. Lastly, a case study is performed in an Australian suburb with 300 LEM participants, and the simulation results are benchmarked with an existing business-as-usual (BAU)scenario. The simulation results outline that the formulated LEM mechanism 1) reduces the electricity cost of participants remarkably while improving their self-sufficiency, 2) minimises power grid export and import, and 3) retains income margins for the energy retailer and network operator.