Mitsubishi Electric Corporation and Tokyo Institute of Technology (Tokyo Tech) has declared their joint development of an original blockchain technology that can optimize peer-to-peer (P2P) energy trading.
The technology is expected to contribute to more effective use of surplus electricity from renewable energy by creating trading environments that flexibly respond to shared trading needs, particularly to maximize the amount of surplus electricity available in the market at any given time.
Beginning in April, the P2P energy trading system’s performance will be evaluated to further optimize the algorithm as required, aiming at the earliest possible commercialization.
In the collaboration, Mitsubishi Electric has taken charge of designing the P2P energy trading system and its clearing (transaction-completion) functions while Tokyo Tech has handled blockchain technology R&D and the design of an optimal clearing algorithm. 2/4 Flexible P2P Energy Trading Using Blockchain Technology to Optimally Match Trades General blockchain technologies, such as those used for trading cryptocurrencies, require a large number of high-performance computers to perform massive calculations, or mining, when determining the creator of a new block to record trading information.
To clear buy and sell orders, a conventional method4 can be used to match conditions and process transactions, but this does not optimize matches. Mitsubishi Electric and Tokyo Tech have developed an original blockchain technology to optimize P2P energy trading.
Their newly devised distributed-optimization algorithm enables customer computers to share trading goals and data and then optimally match buy and sell orders using minimal computations.
Second, each server searches for buy and sell orders matched to the common goal in the first step. Third, each server shares its search results. In the fourth and final step, each server receives the search results and generates a new block by selecting trades that best meet the shared goal, which adds it to each blockchain.
With buy-seller contracts under the FIT system now expiring, prosumers need to find alternative retail-power suppliers to sell their surplus electricity at acceptable prices. As a new method of trading surplus power, P2P energy trading is attracting attention by allowing prosumers to directly trade surplus energy at optimal prices.