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Energy tracing and blockchain technology: a primary
review
Paul K. Wan 1[0000-0002-4967-3703], Lizhen Huang 1[0000-0001-9387-7650]
1 Norwegian University of Science and Technology, Teknologivegen 22, 2815 Norway
paul.k.wan@ntnu.no, lizhen.huang@ntnu.no
Abstract. Reducing greenhouse emission is a mission for many organizations.
Since road transportation is a major contributor of CO2 emission, there is a shift
towards electric vehicles (EV) rather than fuel vehicles due to zero CO2 emission
during operation stage. With the gradual shift towards EV, the demand for
electricity would also increase. Thus, it is important to move our attention on how
electricity is generated because the provenance of electricity supply is closely
linked to climate change. Energy system is a complex resulting in difficulty to
truly verify the claims of only using green energy source to generate electricity.
Blockchain technology caught the attention of researchers to adapt this
technology to trace the end-to-end process of products. The purpose of this paper
is to identify the current state-of-art focusing on energy tracing and blockchain
in academic and commercial sector. From our search, we identified one literature
and one commercial project that focus on energy tracing. Effort focusing on
energy tracing remain small. One of the reasons is the electricity is a non-physical
attribute matter which makes tracing of the source challenging. The volatility of
renewable energy source (RES) such as wind and solar power farms, along with
complex energy distribution system, makes tracing harder. Current work on
energy tracing remain scarce and more work should focus on this section to
prevent rebound effect of carbon emission due to the lack of a transparent carbon
footprint.
Keywords: Energy tracing, blockchain, rebound effect, electric vehicle.
1 Introduction
1.1 Background
Moving towards greener energy is a part of the strategy in reducing greenhouse gas
emission. This has been a challenge for various international bodies. The European
Union Commission has put in place legislation to reduce emissions by at least 40% by
2030, as part of the EU's 2030 climate and energy framework. [1]. Nations outside of
EU also committed to bring down the greenhouse emission to a pledge target. For
example, the Norwegian government pledges to be a carbon neutral country by 2050
and Canada pledges to cut carbon emissions by 30 per cent by 2030 [2, 3].
2
Road transportation contributed of greenhouse gas emission up to 70% compared to
other mode of transportation [4]. Similarly, the energy demand for road transportation
is the highest compared to other types. To combat climate change, there is now a
gradual shift towards electric vehicles (EV) from fossil fuel types because fossil fuels-
based vehicles inevitably emits CO2. EV is a greener mode of transportation because
of the zero-carbon emission during the operation phase. Therefore, it is now important
to move our attention to production stage on how electricity is generated.
With the current trend of shifting towards a greener world, the reliance of non-
renewable energy, particularly fossil fuel, is reducing. Offices, residential area,
manufacturing plant and soon, more vehicles rely on electricity. Electricity is generated
from different types of energy source to sustain our daily lives. Different types of
energy source have different impact on climate change. For example, renewable energy
sources like solar power has less negative impact on climate change than fossil fuels.
Owing to the complex distribution of electricity generated from different energy
sources, it is challenging to truly verify the provenance of the electricity. There is an
extensive research on using blockchain as a digital tool to track the provenance of
product and food throughout the entire supply chain. However, the focus on the
provenance of the electricity remains little. This paper is to draw a clearer picture of the
current state-of-art the electricity tracing in the energy sector. To answer this, a
systematic literature review is executed to answer the following two research tasks
(RT).
RT1 : What is the state-of-art?
RT2 : What are the barriers and potential future work?
2 Related work
2.1 Electricity
Things are now more electrified than before. For example, the shift to EV from fuel-
based vehicle. Therefore, it is important to understand how electricity is generated
because it is closely related to climate change. Electricity is the delivery of energy
resulted from a series of transmission across multiple grid levels and the interplay of
numerous entities across several connected infrastructures [5].
Electricity can be generated from two types of sources: (1) Renewable energy sources
(RES) such as solar, wind and Hydro and (2) Non-renewable sources like fossil fuels.
For example, in a fossil fuel plant, electricity is generated through the conversion of
heat energy to electricity while hydropower converts kinetic energy to electricity. The
generated electricity is then transmitted through a series grid then to final consumer as
shown in Fig 1. Both these energy sources generate electricity to support daily lives,
but each have different impact on the climate. A life cycle assessment done by Siddiqui
and Dincer [6], they encouraged electricity derived from hydropower power plant to be
3
heavily utilized because it does not use utilize fossil fuel to generate electricity
throughout the life cycle.
Energy markets is already highly complex and with the increasing share of renewable
energy sources such as wind and solar power plants only serve to amplify this
complexity [5]. Today, there are claims on only utilizing only green energy sources to
generate electricity. The deeper question is how we can know the source and trace the
electricity that we use. A lot of work has mentioned on how blockchain can enhance
the traceability of product within a complex supply chain [7].
Fig. 1. Layout of general electricity network
2.2 Blockchain
Blockchain technology is a distributed ledger that contains replicated and synchronized
digital data. This technology has the potential in enhancing traceability and
transparency owing to how blockchain stores data structure. All valid transactions are
recorded in a block format, and each block is linked with a time stamp and hash
references forming a chain of blocks [8]. The data storage structure ensures that
information and data are stored in a tamper-evident environment [9] because any
attempt to alter information breaks the hash reference and thus makes it obvious to the
other members of the network. This way, a hash reference creates a tamper-evident
environment that maintains and ensures data integrity. Blockchain technology can store
events chronologically which enhance the traceability.
Blockchain has caught the attention of sectors like food [10] and pharmaceutical [11]
sectors to ensure end-to-end traceability and the product integrity. With the similar
interest, this technology can potentially shed some light in energy tracing. However,
the current focus in tracing the provenance of electricity using blockchain remain
unclear. This is an important key as things are electrified, it is crucial to for user to
4
know the degree of “greenness” of the electricity source. To answer this, we will
perform a systematic literature review on blockchain and energy tracing to have a
clearer picture of the current state-of-art.
3 Methodology
3.1 Search requirement
In our search, we include academic, commercial and startup projects. Literature
included mainly literature from: published work reports and application descriptions of
a commercial project, revealing the core idea of the project from both private and public
sectors are collected.
The review of material starts as early as in 2008, since the term blockchain was firstly
introduced, until May 2021 prior to the submission of this paper. Material collection
was carried out through various databases (Scopus, IEEE Xplorer digital library and
Web of science) to gather widest possible samples. Only English papers were included,
with no restrictions on the year or country of publication. We excluded general views,
no full paper, and conference abstracts.
In order to capture blockchain technology specifically within the energy tracing, and to
be as comprehensive as possible, generic keywords we used the following:
• (blockchain) AND (“Energy tracing”)
• (blockchain) AND (“Energy tracking”)
Fig. 2. Summary flow of systematic literature review
3.2 Material collection and analysis
We initially collected a total of 6 papers (3 from Scopus, 2 from Web-of-Science and
1from IEEE Xplorer Library). After a thorough screening based on our systematic
5
literature flow as shown in Figure 2, there is only 1 paper that fits our criteria. Similar,
from our search in the commercial sphere, there is only one commercial project
focusing in energy tracing using blockchain technology.
Table 1. Table captions should be placed above the tables.
Author
Type
Scope
Approach
Comments
Yang, et
al. [12]
Academic
Electric vehicle
Display Green Pass and
checking Green Pass on
the blockchain.
Certification is
difficult to justify the
source of electricity
generation
Iberdrola
Group
Commercial
project
Green energy
certificate
to guarantee, in real
time, that the energy
supplied and consumed
is 100 % renewable
The framework is not
explained
Table 1 gives a summary of the collected material. There is one published literature
which focused on blockchain-based energy tracing in electric vehicles (EV). Yang et
al. [12] published their work on energy tracing method for electric vehicles charging
consumption in relation to the type and source of energy. They designed a platform
which integrates the power trading centre, power dispatching centre, local power
operators and EV user using blockchain. Green pass is stored on blockchain for
checking to ensure to check the renewable transaction. However, electricity generation
is from a mix of different energy source; therefore, a certified green pass may be
difficult to justify the origin of energy source.
Iberdrola Group [13], a company in Spain, is working on to certify the source of
green energy generated wind farms in Spain. They have begun a pilot project based on
using blockchain to guarantee, in real time, that the energy supplied and consumed is
100% renewable. Using this technology, they have managed to link plants where
electricity is produced to specific points of consumption, allowing the source of the
energy to be traced. This increases transparency and ultimately encourages the use of
renewable energy. However, the framework is not explained in details.
4 Finding and discussion
4.1 RT1: What is the state-of-art
After internet of Energy (IoE), blockchain has emerged as a popular technology in the
energy sector by integrating blockchain to can result in a more secure, fast, transparent
and low-cost operation solution [14]. There are eight [5, 14-20] systematic literature
review published on blockchain-based within the energy sector. Andoni, et al. [16]
reviewed and mapped out 140 blockchain commercial and research initiatives on the
challenges and opportunities of the applications of blockchain for energy industries.
They pointed some of the potential impacts are sharing resources for EV charging and
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significantly improve auditing and regulatory compliance. However, they did not
mention on the tracing of the electricity and the energy source in most their work.
Ante, et al. [5] pointed out in their literature review that energy management in smart
grids such as peer-to-peer trading is the potential emerging fields within the energy
sector using blockchain. This is due to what blockchain can offer; immutable
timestamped transaction which makes trading easier and less complex. Private oil and
gas company like Shell [21] also envision the potential of blockchain in renewable
energy source tracking which could change relationship between how energy is
produced and consumed and transform the way companies collaborate and interact to
accelerate the development of low-carbon energy.
Energy tracing is important because without a transparent energy footprint, rebound
effect of carbon emission may occur. The increase in the use of electricity, particularly
EV. This is important for user to know what types of energy source generated
electricity. Since the operation stage are now relying on electricity, the generation stage
becomes the main focus in order to meet the energy demand. If the energy source are
not generated from renewable energy source like hydropower and solar energy, it could
potentially result in increasing production of energy source to meet the demand which
leads to an increase of rebound effect of CO2 emission [22],
Digitalization can help to decarbonise future energy system for example in both tracing
EV consumption and energy management system. Becour is private firm that focuses
on tracking of renewable energy with the goal of increasing transparency of the energy
market accelerate the shift away from fossil-based production [23]. Petrusic and Janjic
[24] proposed a novel charging system to track the origin of the energy for the charging
of EV in multiples systems using multicriteria algorithm. However, both the work did
not mention blockchain technology as digital tool to enhance tracking. This could be
due to the nature of electricity is difficult to trace.
4.2 RT2: What are the barriers and potential future work
Unlike physical object tracking like food and diamond, electricity is a non-physical
attribute making it challenging to trace the origin. The concept of tracking the
provenance of food is easier as current approach is assigned unique identifier to the
physical product but that is not for the case for electricity tracing. The fact that, energy
flow is highly dynamic, which makes electricity more challenging to trace from energy
source of the electricity then to final consumer. The current approach in ensuring the
use of green energy source is by trading of green certificate. Owing to the immutable
nature of blockchain, researchers have suggested this technology can store and trace
the green certificate which guarantees the electricity is generated from green energy.
However, electricity is highly dynamic which make green certificate difficult to truly
reflect the origin of the energy source.
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Another barrier in tracing electricity is because electricity is generated from a mix of
different energy sources in order to provide sufficient electricity. Unlike Norway almost
100 % of the electricity production come from renewable energy sources (RES) [25],
most of the other countries have a diverse energy mix to generate electricity. For
example, in the US about 80% of the electricity is produced from fossil fuels and about
11% is from RES [26]. RES is a better alternative compared to fossil fuels when it
comes the greenhouse emission, but its volatile supply of energy only serves to amplify
this complexity which in turns makes tracing of energy harder. Batteries can be an
alternative to store energy from RES during good weather condition, but it faces issues
such as reduction in power quality and increased of energy loses during charging [27].
Apart from electricity consumption in EV, the electricity consumption in building
sector dominates approximately 30% of the global annual greenhouse gases emission
[28]. And in the entire life span of a building, the operational stage has the largest share
of carbon emission [29, 30]. The International Energy Agency [31] reported that in the
operational stage, up to approximately 50% of the energy supplied is utilized for space
heating and cooling purposes in the OECD countries. Therefore, the types of energy
supply to both residential and non-residential building for activities like heating and
cooling is important to prevent greenwashing and rebound effect of CO2 emission.
5 Conclusion
Blockchain has emerged as a popular technology in the energy sector due to various
benefits such as secure, transparent, and low-cost operation solution offered by
blockchain. However, the focus on the energy tracing remains very limited. The energy
source for electricity generation is closely connected to carbon emission. It is important
to place a strong focus in tracing the energy source since things are more electrified
than before. From our search, only 2 items of literature focus on energy tracing. Current
method of trading green energy certificate may not truly reflect how the energy source
since electricity is highly dynamic. This work highlights the need to focus on energy
tracing. With the benefits offer by blockchain, particularly in terms of traceability, it
potentially can reduce some complexity and open up new types of services in the energy
market for a more transparent green energy trading. Although from our search, there
are not many relevant literature and commercial project focusing on energy tracing at
this stage, yet. Nonetheless, it is vital to understand the entire end-to-end of electricity
generation to consumption in order to have a positive impact on climate change.
6 Acknowledgement
This study is funded by the NTNU digital transformation project: Trust and
transparency in digital society through blockchain technology.
8
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