Blockchain-Based Decentralized Stochastic Energy Management in IoT-Enabled Smart Grid With Voltage Regulation Coordination

In this article, a blockchain-based decentralized stochastic energy management scheme is proposed for smart grid-connected households with photovoltaic generation and battery energy storage systems. The proposed scheme autonomously solves the joint optimization problem of maximizing individual household benefits while also minimizing total line loss in the distribution system. Internet of Things (IoT) technology is essential for the optimization as continuous sensing of the household power and battery states, coupled with autonomous bidding in voltage regulation auctions, are vital ingredients of this energy management scheme. A double-auction algorithm for coordinated voltage regulation with IoT access control is designed and implemented as a smart contract, which enables proactive voltage issue diagnosis while preserving privacy. The proposed blockchain-based decentralized stochastic energy management scheme consists of two subschemes, corresponding to individual households and the distribution system, respectively. Two decentralized stochastic energy management schemes are proposed for the blockchain platform. Specifically, an individual household energy management scheme is developed to maximize the benefit for each residence, while a collaborative energy management scheme is proposed to optimize the system’s joint benefit by minimizing the total line loss. Both schemes are modeled as decentralized Markov decision processes, thus avoiding the need for centralized computation. To enhance the scalability of the smart contract, a novel pruning-based auction algorithm for voltage regulation is developed. A case study on the IEEE 123-Node Test Feeder indicates that residential voltage regulation can be coordinated effectively through the proposed scheme. The algorithm is computationally efficient, with computation time scaling logarithmically with the number of participants.