Operational performance analysis of blockchain-enabled mechanisms for decentralized energy trading in smart grids

Abstract

With the increasing penetration of distributed energy resources, electric vehicles, and prosumers, the demand for secure, scalable, and low-latency transaction platforms in smart grid–based transactive energy systems has grown substantially. Although blockchain technology offers a promising solution for decentralized energy trading, the choice of consensus mechanism critically determines system performance and practical feasibility. This study evaluates the relative performance of Clique, Istanbul Byzantine Fault Tolerance (IBFT), and proof of work (PoW) consensus algorithms to identify the most suitable approach for transactive energy applications in a smart grid environments. Using a five-node blockchain network, key performance indicators (KPIs)-namely, latency, throughput, and transaction failure rate-are quantified for essential market functions, including bidding, market clearing, payment settlement, and balance queries. The results demonstrate that permissioned consensus mechanisms significantly outperform PoW in term of responsiveness, scalability, and reliability. Among the evaluated approaches, IBFT exhibits the highest throughput and the lowest latency, making it the most suitable choice for real-time and near-real-time energy market operations. Clique delivers satisfactory performance in small-scale deployments but exhibits scalability limitations as transaction volumes increase. In contrast, PoW suffers from excessive latency and high failure rates, rendering it unsuitable for smart grid service operations. Overall, the findings indicate that permissioned blockchain platforms employing IBFT can effectively support efficient, secure, and scalable transactive energy markets for future smart grid infrastructures.

Keywords

smart grid / transactive energy / blockchain / permissioned blockchain / IBFT consensus / Clique consensus / proof of work / distributed energy resources / peer-to-peer energy trading / electric vehicles / market latency / throughput analysis

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