Tracing and Securing DER Transactions in the Wholesale Electricity Market using Blockchain

Participation of distributed energy resources (DERs) in the wholesale electricity market (WEM), provides an opportunity to DER owners to profit from dynamic energy prices and ancillary service products (ASPs) while enhancing reliability and flexibility of power systems. Recently announced FERC Order 2222 in the USA clarifies the regulatory rules to support this participation. The order directs the WEMs across the USA to accommodate the participation of DERs in the market through aggregators. This opportunity encounters two major challenges: (i) traceability of DERs service support by the aggregator, (ii) cybersecurity of the communications among the ISO, aggregator and DERs. To address these challenges, we propose a blockchain-based solution to assure traceability and security of energy/monetary transactions among different entities involved in this arrangement. First, we discuss what the ASPs characteristics of the aggregator-DERs engagement are. Next, we define the data that needs to be exchanged among the involved entities and how the energy, ASP and monetary transactions can be validated based on this data. Last, we discuss the blockchain framework design to preserve privacy, the consensus algorithm for transaction exchange, and data to be stored in the blocks.