NEXT GENERATION AUTONOMOUS ENERGY TRADING PLATFORM

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EXECUTIVE Summary

TYMLEZ joined forces with the University of Groningen, the FOCAFET Foundation, VU Amsterdam and DNV-GL to help create a new kind of energy trading market. This automated exchange enables energy consumers who produce electricity (“prosumers”) to sell excess energy to those who need it. This energy market can also be used for the energy sharing between members of a network. 

This energy market comes in the form of an energy-trading platform, called OurEnergy.

 

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Technical Description

OurEnergy runs on the TYMLEZ TBSP platform, which includes a set of common components, called plugins.

The prosumers, using their smart meters, place their energy bids and offers on the TYMLEZ platform, and the matching plugin matches these offers.

The TBSP platform provides a set of plugins specifically built for the energy market. See the diagram below for an overview of the platform's architecture:

tymlez energy marketplace OurEnergy Architecture

A highly efficient immutable digital public ledger that is cryptographically secured  

In short, blockchain technology was chosen for OurEnergy since it

  • enables transparency for all parties.
  • stores an anonymized records that cannot be changed
  • enables peer to peer transactions without the need of a third party
  • enables and enhances monitoring and auditing
  • integrates natively with IoT devices like smart meters through Node-RED.
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Challenge: energy not effectively distributed due to structural constraints

The transition to sustainable sources of energy has led to many changes in the energy sector. One such change is the prevalence of renewable sources of energy with the rise of consumers who produce energy primarily through the installation of rooftop solar panels, as well as collective initiatives such as local energy communities.

A large number of small producers leads to highly distributed energy production. However, renewables also do not offer the same level of control as traditional sources of energy: they inherently depend on external factors, creating a potential disparity between the supply and demand of energy.

  • Monolithic generators provide majority electric power to consumers
  • Consumer becoming the producer of energy (prosumer)
  • Centrally controlled
  • Electricity infrastructure relies on centralised market system
  • Current energy infrastructure centralised control requires a redesign

 

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Limitations

At the same time, demand for electricity is rapidly increasing. The balance between supply and demand must be maintained at all times.

Current storage technologies cannot resolve the problem of detached production and consumption in its entirety, since they offer only a limited capacity at a relatively high cost.

While excess supply may be directed to the grid, this is an unsustainable solution on the long term and is not cost-effective for prosumers.

The external factors, lack of direct exchange and expensive but limited energy storage solution leads to energy imbalance and the ineffective distribution of resources.

  • Lack of large scale energy storage
  • Energy must be used when generated
  • Electrons do not differentiate and cannot be tracked
  • Impossible to trade energy directly with neighbor
  • Energy is centrally distributed to and from the grid
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Ensuring the effective distribution of energy

The OurEnergy project envisions a new energy market that increases the effective utilisation of local renewable energy sources through a platform designed for peer-to-peer trading of energy.

The trading platform, built on top of the TYMLEZ platform, introduces a new market where energy can be exchanged among members of a local energy community, for example, and uses blockchain technology to provide full transparency and guarantees about the origin of energy.

With this platform, prosumers can sell any excess supply, and consumers can buy energy directly from the source for immediate consumption or for later consumption or even sale at a later point in time.

tymlez energy marketplace ourenergy

The solution proposed is called the OurEnergy Platform, comprising a matching plugin, a smart contract generator, a blockchain implementation, and smart meters.

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A marketplace powered by smart contracts

Any exchange starts with the creation of a bid to buy or sell energy on the platform. This bid is then matched to other bids based on both the indicated quantity and price.

Matching bids result in a smart contract, which is stored on the blockchain. The matches themselves, however, are stored off-chain in a match database in compliance with consumer privacy and GDPR. 

Trading takes place within a time window of 15 minutes; the bids and the contracts for this time window must be available before the start of that period. 

These contracts indicate a commitment of both parties to produce and consume a certain amount of energy within that particular window of time.

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Settlement

Afterwards, settlement takes place for each of the contracts, based on the meter readings from the smart meters.

It is based on the amount of energy recorded in the contract and any potential imbalance that may have been created by deviation from the contract.

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Internet of Entities

The proposed decentralised energy market does not have clearly defined boundaries and is highly dynamic. To accommodate its dynamic nature and to enable interoperability with other systems, the design follows the principles and open and free data standards of the Internet of Entities defined by the FOCAFET Foundation.

On this Internet of Entities, entities can interact with each other in meaningful ways, regardless of the language in which they have been declared. An entity can be 'a distinct anyone or anything', such as a person, organisation, product, service, device, rule, event, or group.

The Internet of Entities works with the Uniform Entity and Transaction Protocol (UETP) and 1LANGUAGE, a quantised metadata repository available in many languages.

UETP makes use of UETP identifiers (U3IDs) and UETP semantic extension numbers (USENs) that together make unique information addresses.

The U3ID both serves as a universally unique identifier and an interpretable type and subtype indicator that defines how the respective entity must, should, could and would need to interact with other entities on the Internet of Entities.

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Implementation

The backend contains OurEnergy's business logic: it receives the orders, splits them and then sends them to the matching algorithm. Once matches are found, the backend creates a smart contract and a payment asset - both of which go on the blockchain.

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AI & Automation

OurEnergy automates the process of trading energy and saves time by estimating the amount of energy to be exchanged and its price.

Smart devices driven by artificial intelligence algorithms generate bids autonomously, based on user preferences and predictions.

This automation also optimizes the behaviour of all of these devices across all the participants of an energy market to achieve a certain objective, such as ensuring the stability of the network.

A prediction algorithm provides the estimated production and consumption of energy together with a prediction of the prices of the different energy markets.

The solution to this optimisation problem provides the optimal behaviour of all the entities in the community, such as

  • how much energy to charge or discharge from storage devices
  • when to run the flexible loads
  • making commitments to the markets that are necessary for creating bids
 

Download a free copy of the OurEnergy project