When Energy Trading meets Blockchain in Electrical Power System: The State of the Art (1902.07233v1)

Abstract: With the rapid growth of renewable energy resources, the energy trading began to shift from centralized to distributed manner. Blockchain, as a distributed public ledger technology, has been widely adopted to design new energy trading schemes. However, there are many challenging issues for blockchain-based energy trading, i.e., low efficiency, high transaction cost, security & privacy issues. To tackle with the above challenges, many solutions have been proposed. In this survey, the blockchain-based energy trading in electrical power system is thoroughly investigated. Firstly, the challenges in blockchain-based energy trading are identified. Then, the existing energy trading schemes are studied and classified into three categories based on their main focus: energy transaction, consensus mechanism, and system optimization. And each category is presented in detail. Although existing schemes can meet the specific energy trading requirements, there are still many unsolved problems. Finally, the discussion and future directions are given.

• The paper categorizes blockchain energy trading schemes into energy transactions, consensus mechanisms, and system optimization frameworks.
• The paper demonstrates that while blockchain enhances security and privacy, it also introduces efficiency, cost, and environmental challenges.
• The paper calls for further research on optimizing consensus algorithms, developing robust regulatory frameworks, and improving system sustainability.

Blockchain Integration in Energy Trading Systems: A Comprehensive Analysis

The transition from centralized to distributed energy trading systems has necessitated novel approaches, particularly in the field of electrical power. This paper by Naiyu Wang et al. explores the current state and challenges associated with blockchain-based energy trading systems in this context. The paper provides a detailed categorization of existing energy trading schemes based on blockchain technology, delineating the main focal areas: energy transaction, consensus mechanisms, and system optimization. Despite advancements, numerous issues remain unresolved, necessitating further investigation and development.

Key Challenges in Blockchain-Integrated Energy Trading

The authors identify significant disadvantages inherent in traditional centralized energy trading models, such as high costs, security risks, and inflexibility. The centralized systems also face privacy issues as third-party intermediaries can expose users' consumption patterns. Blockchain technology offers potential solutions by leveraging decentralization to enhance security and privacy, yet it is not without its flaws. Efficiency constraints and transaction costs present ongoing challenges, particularly for real-time communication and appropriate pricing models. Additionally, the environmental impact due to high energy consumption of blockchain operations remains a concern.

Classification of Blockchain-Based Energy Trading Schemes

The paper classifies current energy trading schemes as follows:

1. Energy Transaction: This encompasses pre-trade communication, matching, auction mechanisms, pricing, and settlement procedures. Address fuzzification and data hiding methods, using technologies such as zero-knowledge proofs and ring signatures, aim to protect user privacy. Auction mechanisms are explored to optimize user satisfaction and system efficacy.
2. Consensus Mechanisms: The authors examine traditional mechanisms like Proof-of-Work, while advocating for alternatives such as Proof-of-Stake to mitigate high computational costs. Novel consortium-based mechanisms are considered to enhance transaction verification processes.
3. System Optimization: Structural optimizations aim to bolster performance through frameworks like interactive energy control models and fog computing integrations. Operational cost minimization strategies emphasize individual and total cost reductions, often leveraging cloud-edge collaborations for optimization.

Implications and Future Directions

This paper provides insights into potential future advancements and challenges within blockchain-based energy trading systems. Key issues hindering widespread adoption include the absence of robust regulatory frameworks and the need for improved consensus algorithms. Furthermore, ensuring privacy and security during data transmission remains an area ripe for development. Physical layer implementation and environmental sustainability are critical factors that require innovative solutions.

The authors discuss the necessity for incentivizing system user participation and advocate for the exploration of broader blockchain applications within energy systems, such as managing carbon emissions or enhancing renewable energy adoption.

Conclusion

In summary, the integration of blockchain technology into energy trading systems presents opportunities for efficiency gains and enhanced security. However, significant technical and regulatory challenges must be overcome to facilitate mainstream adoption. Future research must focus on refining consensus mechanisms, enhancing privacy protections, and reducing environmental impacts, while exploring the potential for blockchain applications beyond immediate trading transactions.