A DLT-based Proof of Concept Marketplace for Trading Guarantees of Origin

Abstract

Decarbonization and digitalization play critical roles in the drive towards a more sustainable energy sector. Energy provenance, or ability to track emissions and meet standards, has become increasingly important. To address these challenges, the European Union (EU) has implemented the European Energy Certificate System (EECS), but the existing certificate trading process remains cumbersome, bureaucratic, and prone to errors. As an alternative solution, this paper presents a decentralized Guarantees of Origin (GO) trading platform based on Ethereum, which integrates marketplace and transfer routes for energy certificates. Utilizing smart contracts for a double auction, certificates are traded as quasi-unique Semi-Fungible Token (SFT), offering a more transparent and traceable process. This is implemented alongside a power simulation representing the production side of the certificate market. Thus, two models are deployed in a co-simulation with the goal of showcasing a proof-of-concept for such a decentralized marketplace.