From crypto currency to electricity trading
Blockchains were developed to handle transactions between participants in a network in a tamper-proof manner – directly, without external control or monitoring by a central authority. The technology is familiar from cryptocurrencies, such as Bitcoin or Ether.
Blockchain technology is now also being used for various other applications. In Brooklyn, New York, a local electricity market based on a blockchain is already in operation.
SmartPI – interface from household to blockchain
The blockchain connects all participants to the local electricity market. A SmartPI, an extended Smart Meter, is installed in every household. This device measures power consumption and production, and serves as an interface to the blockchain. Households can communicate with each other and execute transactions via the SmartPI. In addition, the meter can control other devices, such as electric heaters or battery storage systems.
Smart Contracts specify how transactions are processed by the blockchain logic. Electricity producers and consumers enter their preferences in an app, so that purchases and sales of electric energy can be processed automatically.
Which blockchain is suitable?
There are now different types of blockchains available (public, consortium, private), which vary in speed, security, privacy and energy efficiency. The project partners are evaluating which type of blockchain is suitable for a local electricity market.
And what about the energy consumption of the blockchain?
Blockchains distribute a ledger across many computers without relying on a central authority. Since the ledger is distributed, there must be agreement as to whether the existing versions are valid. This task is performed by a consensus algorithm. Depending on the type of blockchain, the operation of this algorithm can consume a lot of electricity. However, there already exist projects and blockchains that validate transactions based on algorithms that consume significantly less energy. Many of these projects already play an important role in the blockchain world. The project team is monitoring these new developments and will integrate them wherever possible.
Bosch IoT Lab, University of St. Gallen
University of Lucerne
Supercomputing Systems AG
Bits to Energy Lab, ETH Zurich
Concept paper on data protection at Quartierstrom
How is privacy protected in a peer-to-peer energy market? Challenges and solutions are discussed in the concept paper “Privacy-Preserving P2P Energy Market on the Blockchain” .
|Arne Meeuw, University of St. Gallen|
“Blockchain technology provides an ideal environment to build a system based on economic interests. Thanks to the decentralized approach, we can ensure a high level of reliability, efficient coordination of participants, and automation of billing processes.”
Source: Austrian Federal Ministry of Education, Science and Research
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