A blockchain-based smart grid: towards sustainable local energy markets

The increasing amount of renewable energy sources in the energy system calls for new market approaches to price and distribute the volatile and decentralized generation. Local energy markets, on which consumers and prosumers can trade locally produced renewable generation directly within their community, balance generation and consumption locally in a decentralized approach. We present a comprehensive concept, market design and simulation of a local energy market between 100 residential households. Our approach is based on a distributed information and communication technology, i.e. a private blockchain, which underlines the decentralized nature of local energy markets. Thus, we provide energy prosumers and consumers with a decentralized market platform for trading local energy generation without the need of a central intermediary. Furthermore, we present a preliminary economic evaluation of the market mechanism and a research agenda for the technological evaluation of blockchain technology as the local energy market’s main information and communication technology.


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