Evaluating the Barriers to Blockchain Adoption in the Energy Sector: A Multicriteria Approach Using the Analytical Hierarchy Process for Group Decision Making

Abstract

The blockchain has been proposed for use in various applications in the energy field. Although the blockchain has technical strengths, several obstacles affect the application of the technology in energy services. The scope of this study is to highlight and prioritise the most important barriers to such applications. The first step in this direction is specifying the potential areas of the implementation of blockchain technology in the energy sector. Two useful tools for market analysis were used: Political, Economic, Social, Technological, Legal and Environmental, PESTLE Analysis, and Strengths, Weaknesses, Opportunities and Threats, SWOT Analysis, which examine external and internal factors, respectively. Thus, a list of the most important elements hindering the incorporation of the blockchain in the energy sector was extracted. The detected barriers were classified and ranked by energy and IT experts using the multicriteria method, “Analytical Hierarchy Process for Group Decision Making”. The results reveal that legal barriers relating to the complexities of deficiencies of regulations are the most significant, while technological barriers, especially those related to security issues, are also important. Sociopolitical barriers related mainly to lack of trust in blockchain, as well as economic concerns such as high upfront costs, are less influential but should still be considered. The conclusions of the conducted research have the potential to guide market actors in their endeavours to modernise energy systems through the use of the blockchain, assisting them in designing the most appropriate market strategies.

BPET: A Unified Blockchain-Based Framework for Peer-to-Peer Energy Trading

“…For instance, if there is an SMP calculated for each minute in an hour, the pool price will be the average of all the 60 SMPs. However, in most cases, the pool price is calculated as a weighted average (i.e., as a sum of the multiplication results of each SMP and its duration in minutes divided by 60) as shown in Equation (5). All pool prices are stored on-chain and indexed by their timestamps in hours.…”

“…However, developing such a system entails substantial effort and cost. Challenges include but are not limited to technical complexity, blockchain platforms' scalability and interoperability, regulatory frameworks and standardization, smart contract vulnerabilities, and market dynamics [5,6]. On one hand, the intricacies of the blockchain technology stack demand experienced developers to ensure system security and efficiency.…”