Blockchain: an Enabling Technology for Expanding the Horizon of Active Distribution Networks

Recent changes in electricity distribution networks, such as extensive penetration of renewable energy resources (RERs), have brought about new challenges for operators. Transition from centralized energy management schemes toward decentralized ones is one of the major transformations that has been made to improve the performance, sustainability, and resilience of distribution networks and to adapt them for their ongoing changes. Internet has made its way to electricity distribution networks through the Internet of things (IoT). This information technology has emerged in the distribution networks to better accommodate the operational and management transformations. As a result, the intrinsically decentralized technology of blockchain has gained momentum as a secure platform for information exchange through IoT in distribution networks. This paper initially introduces the blockchain technology and elucidates its operation. Further, it analyzes the transition of the distribution networks to what is called active distribution networks and their functionality. Next, blockchain is represented as an effective technology for maintaining the information security and also eliminating trusted third parties in managing distribution networks. Finally, peer-to-peer energy markets are explained as an application of blockchain technology in distribution systems.