Skip to main content
SpringerLink
Log in

Blockchain in Smart Energy Grids: A Market Analysis

  • Conference paper
  • First Online:
Information Systems (EMCIS 2020)

Part of the book series: Lecture Notes in Business Information Processing ((LNBIP,volume 402))

Abstract

Modern society consumes a huge amount of energy, making the energy industry highly important across the globe. Customers are supplied with the electricity via the energy grid, as part of the utility value chain and pay on per-unit consumed basis. Thus, grid operations and energy prices have little effects on actual energy demand because grid imbalances frequently arise rapidly over very short periods of time, due to imprecise forecasts or unexpected events. Non-predictable renewable energy sources variable generation raises crucial challenges in grid management, making grid defection a rapidly increasing challenge to traditional energy markets. Blockchain technology has been studied to overcome these problems for application in the smart energy grid, and experts agree that it has the potential to change the electricity market. Blockchain and distributed ledger technologies can promote a transparent, secure and decentralized transactions network that will allow new innovative business solutions. Although, the integration of blockchain into the smart energy grid poses some challenges and prohibits the widespread use of blockchain technology in the energy sector. Therefore, in this paper a market analysis was conducted, to investigate the parameters that affect the large-scale adoption of blockchain in smart energy grids. The first part of the paper is setting up the scene, introducing the blockchain and smart grid fundamentals, as well as presenting blockchain’s potential impact on different energy use cases. On the second part of the paper the market analysis is presented, providing blockchain technology’s market opportunities within the energy grid. The paper ends with a description of threats and market challenges that the technology has to address in order to get through the hype, prove its economic, social and technological potential and eventually be accepted in the mainstream.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 84.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 109.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  1. European Commission: 2020 Climate and Energy package (2007). http://ec.europa.eu/clima/policies/strategies/2020/index_en.htm

  2. Aghaei, J., Alizadeh, M.I.: Demand response in smart electricity grids equipped with renewable energy sources: a review. Renew. Sustain. Energy Rev. 18, 64–72 (2013), Pergamon. https://doi.org/10.1016/j.rser.2012.09.019

  3. Poudyal, R., Loskot, P., Nepal, R., Parajuli, R., Khadka, S.K.: Mitigating the current energy crisis in Nepal with renewable energy sources. Renew. Sustain. Energy Rev. 116, 109388 (2019). https://doi.org/10.1016/j.rser.2019.109388

  4. Zhang, M., Eliassen, F., Taherkordi, A., Jacobsen, H.A., Chung, H.M., Zhang, Y.: Energy trading with demand response in a community-based P2P energy market. In: 2019 IEEE International Conference on Communications, Control, and Computing Technologies for Smart Grids, SmartGridComm 2019 (2019). https://doi.org/10.1109/smartgridcomm.2019.8909798

  5. Mollah, M.B., et al.: Blockchain for future smart grid: a comprehensive survey. IEEE Internet Things J. 1–1 (2020). https://doi.org/10.1109/jiot.2020.2993601

  6. Fotiou, N., Pittaras, I., Siris, V.A., Voulgaris, S., Polyzos, G.C.: Secure IoT Access at Scale Using Blockchains and Smart Contracts. In: 2019 IEEE 20th International Symposium on “A World of Wireless, Mobile and Multimedia Networks” (WoWMoM), pp. 1–6 (2019). https://doi.org/10.1109/wowmom.2019.8793047

  7. Asfia, U., Kamuni, V., Sheikh, A., Wagh, S., Patel, D.: Energy trading of electric vehicles using blockchain and smart contracts. In: 2019 18th European Control Conference, ECC 2019, pp. 3958–396 (2019). https://doi.org/10.23919/ECC.2019.8796284

  8. Sengupta, J., Ruj, S., Das Bit, S.: A Comprehensive Survey on Attacks, Security Issues and Blockchain Solutions for IoT and IIoT. J. Netw. Comput. Appl. 14, 102481 (2020).https://doi.org/10.1016/j.jnca.2019.102481

  9. Liu, C., Chai, K.K., Zhang, X., Chen, Y.: Peer-to-peer electricity trading system: smart contracts based proof-of-benefit consensus protocol. Wirel. Netw. 1–12 (2019). https://doi.org/10.1007/s11276-019-01949-0

  10. Zhang, P., White, J., Schmidt, D.C., Lenz, G., Rosenbloom, S.T.: FHIRChain: applying blockchain to securely and scalably share clinical data. Comput. Struct. Biotechnol. J. 16, 267–278 (2018). https://doi.org/10.1016/j.csbj.2018.07.004

    Article  Google Scholar 

  11. M. Andoni et al.: Blockchain technology in the energy sector: a systematic review of challenges and opportunities. Renew. Sustain. Energy Rev. 100, 143–174 (2019), Elsevier Ltd. https://doi.org/10.1016/j.rser.2018.10.014

  12. L. Herenčić et al.: Overview of the main challenges and threats for implementation of the advanced concept for decentralized trading in microgrids. In: EUROCON 2019 - 18th International Conference on Smart Technologies (2019). https://doi.org/10.1109/eurocon.2019.8861906

  13. Nhede, N.: Blockchain in energy market to reach $3 billion by 2025. Smart Energy International (2019). https://www.smart-energy.com/industry-sectors/energy-grid-management/blockchain-in-energy-market-to-reach-3-billion-by-2025/

  14. Themistocleous, M., Rupino, P.: Introduction to blockchain and fintech. In: 51st Hawaii International Conference on System Sciences, vol. 9, p. 9981331 (2018). http://hdl.handle.net/10125/50453

  15. Themistocleous, M., Stefanou, K., Iosif, E.: Blockchain in solar energy. Cyprus Rev. 30(2), 203–212 (2018)

    Google Scholar 

  16. da Cunha, P.R., Themistocleous, M., Morabito, V.: Introduction to the Minitrack on The Transformational Impact of Blockchain. In: Proceedings of the 52nd Hawaii International Conference on System Sciences (2019). https://doi.org/10.24251/hicss.2019.819

  17. Themistocleous, M.: Blockchain technology and land registry. Cyprus Rev. 30(2), 195–202 (2018)

    Google Scholar 

  18. Garfinkel, H., Drane, J.: What is blockchain? (2016). https://blockchainhub.net/blockchain-intro/

  19. He, Y., Li, H., Cheng, X., Liu, Y., Yang, C., Sun, L.: A blockchain based truthful incentive mechanism for distributed P2P applications. IEEE Access 6, 27324–27335 (2018). https://doi.org/10.1109/ACCESS.2018.2821705

    Article  Google Scholar 

  20. Massessi, D.: Blockchain Public/Private Key Cryptography in a Nutshell. Medium (2018). https://medium.com/coinmonks/blockchain-public-private-key-cryptography-in-a-nutshell-b7776e475e7c

  21. de Oliveira, G.A., Muthemba, L.J., Unsihuay-Vila, C.: State-of-the-art impacts of Smart Grid in the power systems operation and expansion planning. Brazilian Arch. Biol. Technol. 61(Special issue), 18000400 (2018). https://doi.org/10.1590/1678-4324-smart-2018000400

  22. Mengelkamp, E., Gärttner, J., Rock, K., Kessler, S., Orsini, L., Weinhardt, C.: Designing microgrid energy markets: a case study: the brooklyn microgrid. Appl. Energy 210, 870–880 (2018). https://doi.org/10.1016/j.apenergy.2017.06.054

    Article  Google Scholar 

  23. Mylrea, M., Gourisetti, S.N.G.: Blockchain for smart grid resilience: exchanging distributed energy at speed, scale and security. In: Proceedings - 2017 Resilience Week, RWS 2017, pp. 18–23 (2017). https://doi.org/10.1109/rweek.2017.8088642

  24. van Leeuwen, G., AlSkaif, T., Gibescu, M., van Sark, W.: An integrated blockchain-based energy management platform with bilateral trading for microgrid communities. Appl. Energy 263, 114613 (2020). https://doi.org/10.1016/j.apenergy.2020.114613

    Article  Google Scholar 

  25. Wang, X., Yang, W., Noor, S., Chen, C., Guo, M., van Dam, K.H.: Blockchain-based smart contract for energy demand management. Energy Procedia 158, 2719–2724 (2019). https://doi.org/10.1016/j.egypro.2019.02.028

    Article  Google Scholar 

  26. Miglani, A., Kumar, N., Chamola, V., Zeadally, S.: Blockchain for internet of energy management: review, solutions, and challenges. Comput. Commun. 151, 395–418 (2020). https://doi.org/10.1016/j.comcom.2020.01.014

    Article  Google Scholar 

  27. Liu, C., Chai, K.K., Zhang, X., Chen, Y., Peer-to-peer electricity trading system: smart contracts based proof-of-benefit consensus protocol. Wirel. Netw. (2019). https://doi.org/10.1007/s11276-019-01949-0

  28. Mhaisen, N., Fetais, N., Massoud, A.: Secure smart contract-enabled control of battery energy storage systems against cyber-attacks. Alexandria Eng. J. 58(4), 1291–1300 (2019). https://doi.org/10.1016/j.aej.2019.11.001

    Article  Google Scholar 

  29. Minoli, D., Occhiogrosso, B.: Blockchain mechanisms for IoT security. Internet Things 1–2, 1–13 (2018). https://doi.org/10.1016/j.iot.2018.05.002

    Article  Google Scholar 

  30. Deval, V., Norta, A.: Mobile smart-contract lifecycle governance with incentivized proof-of-stake for oligopoly-formation prevention. In: Proceedings - 19th IEEE/ACM International Symposium on Cluster, Cloud and Grid Computing, CCGrid 2019, pp. 165–168 (2019). https://doi.org/10.1109/ccgrid.2019.00029

  31. Li, Y., Yang, W., He, P., Chen, C., Wang, X.: Design and management of a distributed hybrid energy system through smart contract and blockchain. Appl. Energy 248, 390–405 (2019). https://doi.org/10.1016/j.apenergy.2019.04.132

    Article  Google Scholar 

  32. Alam, M.R., St-Hilaire, M., Kunz, T.: Peer-to-peer energy trading among smart homes. Appl. Energy 238, 1434–1443 (2019). https://doi.org/10.1016/j.apenergy.2019.01.091

    Article  Google Scholar 

  33. Long, C., Wu, J., Zhang, C., Thomas, L., Cheng, M., Jenkins, N.: Peer-to-peer energy trading in a community microgrid. In: IEEE Power and Energy Society General Meeting, vol. 2018, pp. 1–5 (2018). https://doi.org/10.1109/pesgm.2017.8274546

  34. Alam, M.T., Li, H., Patidar, A.: Bitcoin for smart trading in smart grid. In: IEEE Workshop on Local and Metropolitan Area Networks, vol. 2015 (2015). https://doi.org/10.1109/lanman.2015.7114742

  35. Aitzhan, N.Z., Svetinovic, D.: Security and privacy in decentralized energy trading through multi-signatures, blockchain and anonymous messaging streams. IEEE Trans. Dependable Secur. Comput. 15(5), 840–852 (2018). https://doi.org/10.1109/TDSC.2016.2616861

    Article  Google Scholar 

  36. Zyskind, G., Nathan, O., Pentland, A.S.: Decentralizing privacy: using blockchain to protect personal data. In: Proceedings - 2015 IEEE Security and Privacy Workshops, SPW 2015, pp. 180–184 (2015). https://doi.org/10.1109/spw.2015.27

  37. Mengelkamp, E., Notheisen, B., Beer, C., Dauer, D., Weinhardt, C.: A blockchain-based smart grid: towards sustainable local energy markets. Comput. Sci. Res. Dev. 33(1–2), 207–214 (2018). https://doi.org/10.1007/s00450-017-0360-9

  38. Omar, A.S., Basir, O.: Identity management in IoT networks using blockchain and smart contracts. In: 2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData), pp. 994–1000 (2018). https://doi.org/10.1109/cybermatics_2018.2018.00187

  39. Diloitte: Blockchain Trends for 2020 (2020). https://www2.deloitte.com/content/dam/Deloitte/ie/Documents/Consulting/Blockchain-Trends-2020-report.pdf

  40. Xie, J., Yu, F.R., Huang, T., Xie, R., Liu, J., Liu, Y.: A survey on the scalability of blockchain systems. IEEE Netw. 33(5), 166–173 (2019). https://doi.org/10.1109/MNET.001.1800290

    Article  Google Scholar 

  41. Digiconomis: Bitcoin Energy Consumption Index. https://digiconomist.net/bitcoin-energy-consumption

  42. EnergyWeb: The Energy Web Chain (2019). https://www.energyweb.org/wp-content/uploads/2019/05/EWF-Paper-TheEnergyWebChain-v2-201907-FINAL.pdf

  43. Frizzo-Barker, J., Chow-White, P.A., Adams, P.R., Mentanko, J., Ha, D., Green, S.: Blockchain as a disruptive technology for business: a systematic review. Int. J. Inf. Manage. 51, 102029 (2020). https://doi.org/10.1016/j.ijinfomgt.2019.10.014

    Article  Google Scholar 

  44. Alladi, T., Chamola, V., Rodrigues, J.J.P.C., Kozlov, S.A.: Blockchain in smart grids: a review on different use cases. Sensors 19(22), 4862 (2019). https://doi.org/10.3390/s19224862

    Article  Google Scholar 

Download references

Acknowledgements

This work has been partially supported by the PARITY project, funded by the European Commission under Grant Agreement Number 864319 through the Horizon 2020.

Author information

Authors and Affiliations

  1. Institute for the Future (IFF), University of Nicosia, Nicosia, Cyprus

    Evgenia Kapassa, Marinos Themistocleous & Marios Touloupos

  2. Cuerva, Granada, Spain

    Jorge Rueda Quintanilla

  3. Faculty of Business and Law, British University of Dubai, Dubai, UAE

    Maria Papadaki

Authors
  1. Evgenia Kapassa
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Marinos Themistocleous
    View author publications

    You can also search for this author in PubMed Google Scholar

  3. Jorge Rueda Quintanilla
    View author publications

    You can also search for this author in PubMed Google Scholar

  4. Marios Touloupos
    View author publications

    You can also search for this author in PubMed Google Scholar

  5. Maria Papadaki
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Evgenia Kapassa .

Editor information

Editors and Affiliations

  1. Department of Digital Innovation, School of Business, University of Nicosia, Nicosia, Cyprus

    Marinos Themistocleous

  2. British University in Dubai, Dubai, United Arab Emirates

    Maria Papadaki

  3. School of Strategy and Leadership, Coventry University, Coventry, UK

    Muhammad Mustafa Kamal

Rights and permissions

Reprints and permissions

Copyright information

© 2020 Springer Nature Switzerland AG

About this paper

Check for updates. Verify currency and authenticity via CrossMark

Cite this paper

Kapassa, E., Themistocleous, M., Quintanilla, J.R., Touloupos, M., Papadaki, M. (2020). Blockchain in Smart Energy Grids: A Market Analysis. In: Themistocleous, M., Papadaki, M., Kamal, M.M. (eds) Information Systems. EMCIS 2020. Lecture Notes in Business Information Processing, vol 402. Springer, Cham. https://doi.org/10.1007/978-3-030-63396-7_8

Download citation

  • DOI: https://doi.org/10.1007/978-3-030-63396-7_8

  • Published:

  • Publisher Name: Springer, Cham

  • Print ISBN: 978-3-030-63395-0

  • Online ISBN: 978-3-030-63396-7

  • eBook Packages: Computer ScienceComputer Science (R0)

Publish with us

Policies and ethics

Search

Navigation