Examining the Applicability of Blockchain to the Smart Grid Using Proof-of-Authority Consensus

Abstract

Security has been a major challenge in the smart grid since its adoption. This great concern let to the proposal of the application of blockchain technology to the smart grid. Blockchain is a growing list of records, called blocks, that are linked using cryptography and its transactions are validated by a consensus mechanism. The most known and trusted blockchain consensus mechanism is the proof-of-work (PoW) as it can process very little number of transactions per second. However, the proof-of-authority (PoA) consensus mechanism is scalable as it can process thousands of transactions per second without compromising security. This paper focuses on the applicability of blockchain PoA consensus mechanism and how it ensures that transactions are confirmed on time and the integrity of the transactions are upheld in the blockchain. The PoA consensus mechanism is appropriate especially with the adoption of peer-to-peer energy trading between prosumers and consumers. This study proposes a peer-to-peer energy trading in an open blockchain with the help of the Advanced Metering Infrastructure(AMI) that enables smart meters to function optimally for this purpose.