Consortium Blockchain-based Peer-to-Peer Matched Energy Auction Framework

Abstract

Integrating distributed energy resources into smart grids has created opportunities for small energy producers. While big suppliers dominate the energy market, all energy consumers and producers, known as prosumers, should have the same opportunity to trade with each other. Using local energy will encourage local communities to join forces and invest in their clean energy, putting them at the centre of key decisions within their community. With this in mind, the model proposed in this thesis aims to enable prosumers to trade energy within their local area based on a double auction mechanism that matches buyers and sellers using some indication of their electrical proximity. The peer-to-peer energy trading mechanism presented here considers the distance on the distribution network as an extra charge for the use of premises.

The primary motivation of the presented research work is to enable prosumers to be part of a local energy market and encourage large-scale updates instead of relying on central producers to provide the energy they need. The first contribution of this research is the development of a Demand-Prioritized Double Auction Mechanism. This mechanism ensures that all buyers participating in the trade will receive the requested energy. Additionally, prosumers are incentivised to cooperate while defining their reserved price and distance preference. Finally, the second contribution is the Consortium Blockchain Network. This network allows DSOs to access specific transaction data while prosumers have a second channel to submit their bids/offers. Combining these two proposed initiatives will enable prosumers to be part of a local market where the energy they trade is locally produced and consumed. Moreover, the DSOs will benefit from each trade without imposing the same tariff for every trade but based on the use of the distribution network when the trade is completed.

The research has been tested on a radial low-voltage distribution network under a decentralised scheme in smart grids. Results demonstrate that it is possible to promote local consumption and production while considering the costs produced by energy distribution. Losses to prosumers were minimised, and the scalable capacity of the Consortium Blockchain Network was displayed. Future research needs to focus on an alternative method to match the traders so that the system is entirely decentralised. Also, the security implications of the Consortium Blockchain Network need to be considered.