On the Application of Blockchain Technology in Microgrids

To further integrate renewable energy resources into the electricity grids, increasing the consumption of locally produced electricity is one of the key solutions to reduce the operational cost of the future energy system. Therefore, the local and intelligent principles of microgrids in which users can directly exchange energy with other local users via peer-to-peer energy trading functionalities for flexible energy management are of paramount importance. Regarding peer-to-peer energy trading, setting up a virtual trading network for users can be realised via several communication and database mechanisms, in which the focus of the current work is on the application of the blockchain technology. This article aims to shed a light on the required actions and implementation efforts such as pricing mechanisms, privacy constraints, scalability and on the required overarching energy management system. By overviewing the available literature on the application of blockchain technology, this article also aims to provide a critical view on the applicability of this particular technology for peer-to-peer energy trading purposes.