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Blockchain-enabled renewable energy certificate trading: A secure and privacy-preserving approach

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  • Liu, Wei-Jen
  • Chiu, Wei-Yu
  • Hua, Weiqi

Abstract

In the 21st century, transitioning to renewable energy sources is imperative, with fossil fuel reserves depleting rapidly and recognizing critical environmental issues such as climate change, air pollution, water pollution, and habitat destruction. Embracing renewable energy is not only an environmental necessity but also a strategic move with multiple benefits. By shifting to renewable energy sources and supporting their production through the acquisition of renewable energy certificates, we foster innovation and drive economic growth in the renewable energy sector. This, in turn, reduces greenhouse gas emissions, aligning with global efforts to mitigate climate change. Additionally, renewable energy certificates ensure compliance with regulations that mandate the use of renewable energy, enhancing legal adherence while promoting transparency and trust in energy sourcing. To monitor the uptake of renewable energy, governments have implemented Renewable Energy Certificates (RECs) as a tracking mechanism for the production and consumption of renewable energy. They certify the generation of a specific amount of electricity from renewable sources, allowing for accurate tracking of renewable energy contributions to the overall energy mix. However, there are two main challenges to the existing REC schema: (1) The RECs have not been globally adopted due to inconsistent design; (2) The consumer privacy has not been well incorporated in the design of blockchain. In this study, we investigate the trading of RECs between suppliers and consumers using the directed acyclic graph (DAG) blockchain system and introduce a trading schema to help protect consumer information. The DAG system reduces the intense calculation of typical blockchains for scalability and lowers mining fees by eliminating the mining of blocks. The proposed approach allows renewable energy suppliers and consumers to trade RECs globally and to take advantage of secure trading transactions. Our results demonstrate lower transaction time by 41% and energy consumption by 65% compared to proof-of-stake.

Suggested Citation

  • Liu, Wei-Jen & Chiu, Wei-Yu & Hua, Weiqi, 2024. "Blockchain-enabled renewable energy certificate trading: A secure and privacy-preserving approach," Energy, Elsevier, vol. 290(C).
    • Handle: RePEc:eee:energy:v:290:y:2024:i:c:s0360544223035041
    DOI: 10.1016/j.energy.2023.130110
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    References listed on IDEAS

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