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Community Energy Groups: Can They Shield Consumers from the Risks of Using Blockchain for Peer-to-Peer Energy Trading?

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  • Alexandra Schneiders

    (Energy Institute, University College London (UCL), 14 Upper Woburn Place, London WC1H 0NN, UK)

  • David Shipworth

    (Energy Institute, University College London (UCL), 14 Upper Woburn Place, London WC1H 0NN, UK)

Abstract

Peer-to-peer (P2P) energy trading is emerging as a new mechanism for settling the exchange of energy between renewable energy generators and consumers. P2P provides a mechanism for local balancing when it is facilitated through distributed ledgers (‘blockchains’). Energy communities across Europe have uncovered the potential of this technology and are currently running pilots to test its applicability in P2P energy trading. The aim of this paper is to assess, using legal literature and legislation, whether the legal forms available to energy communities in the United Kingdom (UK) can help resolve some of the uncertainties around the individual use of blockchain for P2P energy trading. This includes the legal recognition of ‘prosumers’, the protection of their personal data, as well as the validity of ‘smart contracts’ programmed to trade energy on the blockchain network. The analysis has shown that legal entities, such as Limited Liability Partnerships and Co-operative Societies, can play a crucial role in providing the necessary framework to protect consumers engaging in these transactions. This is particularly the case for co-operatives, given that they can hold members liable for not respecting the rules set out in their (compulsory) governing document. These findings are relevant to other European countries, where the energy co-operative model is also used.

Suggested Citation

  • Alexandra Schneiders & David Shipworth, 2021. "Community Energy Groups: Can They Shield Consumers from the Risks of Using Blockchain for Peer-to-Peer Energy Trading?," Energies, MDPI, vol. 14(12), pages 1-15, June.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:12:p:3569-:d:575610
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    References listed on IDEAS

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    Cited by:

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    2. Lynne L. Kiesling & Leonardo Meeus & Michael G. Pollitt, 2021. "Special Issue “Innovation, Policy, and Regulation in Electricity Markets”," Energies, MDPI, vol. 14(19), pages 1-4, September.
    3. Siripha Junlakarn & Phimsupha Kokchang & Kulyos Audomvongseree, 2022. "Drivers and Challenges of Peer-to-Peer Energy Trading Development in Thailand," Energies, MDPI, vol. 15(3), pages 1-25, February.
    4. Roth, Tamara & Utz, Manuel & Baumgarte, Felix & Rieger, Alexander & Sedlmeir, Johannes & Strüker, Jens, 2022. "Electricity powered by blockchain: A review with a European perspective," Applied Energy, Elsevier, vol. 325(C).
    5. Manuel Casquiço & Bruno Mataloto & Joao C. Ferreira & Vitor Monteiro & Joao L. Afonso & Jose A. Afonso, 2021. "Blockchain and Internet of Things for Electrical Energy Decentralization: A Review and System Architecture," Energies, MDPI, vol. 14(23), pages 1-26, December.

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