Australia has over 2 million PV installations given a combined capacity of over 11.1 gigawatts as of January 2019 (2019). This area experienced extremely rapid growth between 2010 and 2013 and has continued to grow. As Australia’s high capacity of PV installations, distributed energy markets have been established to capitalise on the available energy. Several markets are being trialled around the world including Peer-to-Peer (P2P) energy trading, business-to-business energy trading, wholesale and retail energy, energy commodity trading, and others. The most common market is P2P trading which allows households to trade electricity.
Blockchain is a type of distributed ledger technology that can be used to securely store digital transactions. Blockchain has demonstrated great uptake potential in P2P energy trading with a growing number of start-up companies, pilots, trials, and research projects adopting the technology within their business model. The revolution of blockchain encourages innovation and enables a low-carbon transition and sustainability (Juri, Timo et al. 2016). According to Deloitte (Grewal-Carr V and S. 2016) and PWC (Hasse, Perfall et al. 2016) reports, blockchain has the potential to disrupt the energy sector using energy commodities as digital assets to be traded.
However, concerns over the energy use, the carbon footprint, and the cost of blockchain have recently generated debate. The carbon footprint and cost of blockchain are derived from its validation process which requires specialised hardware with computing power and vast amounts of electricity. Public perceptions on the impact this technology has on the environment and its associate costs have also garnered recent negative publicity. This reduces the perception of the benefits of blockchain technology. To investigate the impact of blockchain, we compare the energy consumed to support blockchain with the total energy saved from the electrical grid from deployment of blockchain-based P2P energy trading.
The aim of this study is to evaluate the cost and benefit of blockchain-based P2P energy trading. The energy consumed and carbons emitted from the blockchain validation process are quantified. The cost of blockchain technology is calculated as well to determine its economic value. This report also provides various insights into the transformation of P2P energy trading using different blockchain scalability solutions. Real data from operating P2P energy trading systems is used in this report