Blockchain-based DR logic: a trade-off between system operator’s and customer’s needs

Abstract

This paper describes a way to include the end users of the electrical network in the Demand Response mechanism using the Blockchain technology and the Smart Contract concepts, thus developing a distributed system where customers can communicate directly with the system operator to provide their flexibility in a transparent, secure and traceable way.The historical data on energy consumption and production of the customers is recorded on the Blockchain, with the Smart Contract evaluating the baseline and the potential support that each customer can provide to fulfill the requested load adaptation communicated by the grid operator. The baseline and the optimal power reduction for a customer (evaluated by the Smart Contract) are provided as input data to an Energy Management System developed by the Authors with the aim of shifting the consumption of each user in response to the Demand Response event in an automated way, satisfying the demand for reduction in the best possible way for customer and grid operator at the same time.The Energy Management System is based on historical trends and performs an economic optimization minimizing the energy supply cost for the end user. Results confirm the possibility to successfully integrate the Blockchain technology to this particular application, and the cooperation with an Energy Management System automates the process by improving the speed and effectiveness of the customer response.