Decentralized Energy Trading with Smart Contracts in Blockchain Ecosystem

Abstract

There has been substantial and incremental penetration of Renewable Energy Sources (RES) in the energy market. Growing number of Distributed Energy Resources (DERs) is paving way for more generation entities latching on to the distribution systems. Today, relevance of prosumer is fast gaining popularity as compared to conventional producers, due to inherent ability to produce as well as to consume power. Therefore, decentralized power generation with prosumers within neighbourhood is gaining traction. Especially, contribution of wind and solar generations in overall power mix has been evolving. Energy trading using conventional Power Purchase Agreements (PPAs) between producers and consumers are currently notarised manual agreements, which is vulnerable to tampering, thefts, inflicted destructions, foisted litigations, faces non compliance issues, non accessibility to all stakeholders etc. In order to obviate conventional forms of executing manual PPAs, it is imperative to resort to proliferated technologies of Internet of Things (IoTs) and use of blockchain applications. Use of smart contracts, particularly in energy trading sector is still niche. Energy trading with blockchain enables speedy, secure, concurrent, decentralised, transparent, fair transactive Peer-to-Peer (P2P) trading. In this paper, P2P trading among prosumer, consumer and microgrid operator has been evolved using MATLAB, Python Web 3.0 and Remix Ethereum IDE. The smart contract using blockchain in times ahead will be disruptive, thus replacing legacy systems of contract management.