Blockchain-Enabled Peer-to-Peer Energy Trading in Smart Microgrids: Security, Scalability, and Economic Analysis

Abstract

 The expansion of Distributed Energy Resources (DERs) across localized power grid infrastructure has radically altered contemporary energy systems, shifting traditional centralized utility models toward dynamic smart microgrids. Peer-to-Peer (P2P) energy trading allows active energy prosumers to exchange surplus renewable electricity directly with neighboring consumers without central utility intermediation. However, widespread practical deployment faces severe technical bottlenecks regarding transaction security, prosumer data privacy, computational scalability, network communication overhead, and real-time market settlement latency. Blockchain technology and self-executing smart contracts provide a decentralized, tamper-resistant framework for trustless trading; yet standard public blockchain architectures suffer from low throughput, high transaction fees, and excessive consensus overhead. This review paper provides an in-depth, technically rigorous review of blockchain-enabled P2P energy trading in smart microgrids, critically evaluating security mechanisms, consensus protocols, layer-2 scalability solutions, and economic auction models. We investigate permissioned consortium ledgers, consensus algorithms (PBFT, PoS, and Sharded PBFT), privacy-preserving cryptographic primitives, and automated double-auction price clearing mechanics. Furthermore, empirical simulation benchmarks evaluate transaction throughput and monthly household energy cost reductions. Finally, key research gaps, implementation constraints, and future research directions are articulated to support real-world microgrid deployment.

KEYWORDS: Blockchain, Peer-to-Peer Energy Trading, Smart Microgrids, Smart Contracts, Distributed Consensus, Scalability, Energy Economics,

Cryptographic Security.