Privacy-Enhancing Settlements Protocol in Peer-to-Peer Energy Trading Markets

This paper proposes a privacy-friendly billing and settlements system for use in peer-to-peer energy trading markets. More specifically, it proposes a privacy-enhancing settlements protocol (PESP) which makes use of a partial homomorphic encryption scheme to facilitate private processing and computation of smart grid users’ monthly energy bill by a semi-trusted third party. In addition, it allows for minor financial penalties to users who participate in peer-to-peer trading but do not accurately predict their energy usage for each period and, as such, import or export varying amounts compared to the amount they have agreed to trade for initially. This encourages predictions to be accurate to help keep the trading fair and aiding suppliers to make accurate predictions about the amount of electricity needed for each trading period. Our security analysis and performance evaluation demonstrate that PESP protects users’ privacy and is efficient in terms of computation and communication cost.