A Blockchain-based Privacy-friendly Renewable Energy Community

Stephan Cejka

, Franz Zeilinger

, Argjenta Veseli

, Marie-Theres Holzleitner

and Mark Stefan

Siemens AG

Osterreich, Vienna, Austria

Energieinstitut an der Johannes Kepler Universit

at Linz, Linz, Austria

AIT Austrian Institute of Technology GmbH, Vienna, Austria

Keywords:

Energy Community, Privacy, Blockchain, Clean Energy Package, Energy Transition, Energy Efﬁciency.

Abstract:

The European Union’s Clean Energy Package introduces two kinds of energy communities, namely the Re-

newable Energy Community (REC) in the Renewable Energy Directive of 2018 and the Citizen Energy Com-

munity (CEC) in the Electricity Directive of 2019. They aim for local improvements of energy efﬁciency, in-

creasing integration of renewable energy sources, and a reduction of greenhouse gas emissions, to be achieved

by jointly producing, temporarily storing, sharing, consuming, and selling locally generated energy. House-

holds and individuals shall thus be enabled to take an active part in the energy transition. When utilizing

blockchain technology for the implementation of such energy communities, as proposed in current research

projects, a focus must be laid on the technology-inherent area of conﬂict with privacy issues, especially since

data on households’ energy consumption count as personal data.

1 INTRODUCTION

Among the biggest challenges of our time is the cli-

mate change caused by enormous man-made emis-

sions of greenhouse gas. The global temperature level

has risen signiﬁcantly in the last few decades and

the rise is expected to continue if no or not-sufﬁcient

countermeasures are taken (IPCC, 2014). To limit the

continuing temperature rise to globally stipulated val-

ues in the 2016 Paris agreement (UNFCCC, 2016),

the European Union aims to reduce greenhouse gas

emissions by at least 40 % by 2030 (European Com-

mission, 2019a). It addressed the energy sector, being

one of the biggest sources of emissions (IPCC, 2014),

by issuing the ‘Clean Energy for all Europeans Pack-

age’ in 2018/2019 (European Commission, 2019c;

European Commission, 2019b). This shall also aim to

reach further key targets for 2030, which are a share

of at least 32 % of renewable energy and an improve-

ment of at least 32.5 % in energy efﬁciency (European

Commission, 2019a).

As suggested countermeasures on the local level,

the Clean Energy Package introduces two kinds of

energy communities to merge the energy production

as well as the consumption of individuals and en-

terprises. While awaiting concrete transpositions of

the Clean Energy Package’s directives into national

law of the European Union’s member states, some

research projects are already dealing with possible

implementations; for example, by using blockchain

technology as proposed in this paper.

We will ﬁrst introduce the Clean Energy Package

with special focus on energy communities (Section 2).

Afterwards, we will go into detail about blockchain

technology, including its known issues with privacy

and energy efﬁciency (Section 3). The main contribu-

tion of this paper will be to combine the two aspects,

by describing a possible implementation of a privacy-

friendly blockchain-based renewable energy commu-

nity (Section 4).

2 CLEAN ENERGY PACKAGE

The latest development in European Union’s energy

law is its ‘Clean Energy for all Europeans Package’,

ﬁrst proposed in 2016, and ﬁnally adopted by the

European Parliament, partly in the end of 2018 and

partly in Summer 2019. One of its main goals is to

bring EU and its member states on track for the re-

vised climate targets for 2030 (European Commis-

sion, 2019c; European Commission, 2019a; Euro-

pean Commission, 2019b). The package itself, con-

sists of four directive and four regulation acts:

• Energy Performance of Buildings Directive (EU)

2018/844,

Cejka, S., Zeilinger, F., Veseli, A., Holzleitner, M. and Stefan, M.

A Blockchain-based Privacy-friendly Renewable Energy Community.

DOI: 10.5220/0009391300950103

In Proceedings of the 9th International Conference on Smart Cities and Green ICT Systems (SMARTGREENS 2020), pages 95-103

ISBN: 978-989-758-418-3

• Renewable Energy Directive (EU) 2018/2001,

• Energy Efﬁciency Directive (EU) 2018/2002,

• Governance of the Energy Union and Climate Ac-

tion Regulation (EU) 2018/1999,

• Electricity Regulation (EU) 2019/943,

• Electricity Directive (EU) 2019/944,

• Regulation on Risk-Preparedness in the Electric-

ity Sector (EU) 2019/941,

• Regulation on the European Union Agency for

the Cooperation of Energy Regulators (EU)

2019/942.

The two acts of main interest for the scope of this pa-

per are printed in bold; the revised Renewable Energy

Directive (RED II) introducing ‘Renewable Energy

Communities (RECs)’ and the revised Electricity Di-

rective (ED II) introducing ‘Citizen Energy Commu-

nity (CECs)’ as a second type of energy communities.

2.1 Evolution to Energy Communities

Those energy communities are a third step in an

evolution shown in Figure 1, starting with house-

holds optimizing their own energy consumption and

proceeding by applying those procedures to apart-

ment buildings next. They are termed ‘renewables

self-consumer’ and ‘jointly acting renewables self-

consumers’ in the deﬁnitions of RED II:

Renewables Self-consumer: ‘a ﬁnal customer [...]

who generates renewable electricity for its own

consumption, and who may store or sell self-

generated renewable electricity activity’.

Jointly Acting Renewables Self-consumers: ‘a

group of at least two jointly acting renewables

self-consumers [...] who are located in the same

building or multi-apartment block’.

According to RED II, those parties shall be able to

‘generate, consume, store, and sell electricity with-

out facing disproportionate burdens’ and ‘[c]itizens

living in apartments [. . . ] should be able to beneﬁt

[. . . ] to the same extent as households in single fam-

ily homes’.

Main parts of the two energy communities’ def-

initions are similar while some differences between

them exist though. Their legal deﬁnitions in RED II

and ED II can be summarized as follows:

Renewable Energy Community:

• a legal entity, based on open and voluntary par-

ticipation, and autonomous,

• controlled by its shareholders or members,

which are natural persons, small or medium en-

terprises, or local authorities,

Figure 1: Evolution to energy communities.

• shareholders or members are located in the

proximity of renewable energy projects owned

and developed by that legal entity,

• its primary purpose is to provide environmen-

tal, economic or social community beneﬁts

rather than ﬁnancial proﬁts.

Citizen Energy Community:

• a legal entity, based on open and voluntary par-

ticipation,

• controlled by shareholders or members that are

natural persons, small enterprises, or local au-

thorities; but open for participation of other en-

tities,

• its primary purpose is to provide environmen-

tal, economic or social community beneﬁts

rather than ﬁnancial proﬁts,

• it may engage in generation, including from

renewable sources, distribution, supply, con-

sumption, aggregation, energy storage, energy

efﬁciency services or charging services for

electric vehicles or provide other energy ser-

vices.

The often appearing term ‘local energy community’

was contained in the European Commission’s draft of

the ED II, but was abandoned in favor of the term

CEC. However, despite the CEC not having a prox-

imity aspect, in our opinion this technical term is

properly suited as an umbrella term for RECs and

CECs. Speaking of RECs’ proximity aspect, this

is one of the main difference between those com-

munities. While an REC’s participant needs to be

located in close proximity to the community’s re-

newable energy projects, CEC’s participants may be

widely spread – optionally also over member states’

borders. CEC’s legal deﬁnition includes a number of

activities they are able to perform, while REC’s def-

inition does not explicitly contain such an enumera-

tion.

However, this paper does not intend to give an in-

depth analysis of RECs’ and CECs’ commonalities

and differences (cf. (Cejka, 2020)). The intention is

SMARTGREENS 2020 - 9th International Conference on Smart Cities and Green ICT Systems

to describe a possible – and already realized – im-

plementation of an REC; thus, the remainder of this

paper will focus on this type of energy communities.

2.2 Renewable Energy Communities

RECs aim for the participation of individuals to im-

prove the local acceptance of renewable energy, local

investment, and improved participation of citizens in

the energy transition. To that end, the REC shall be-

come a non-discriminating position among the other

(larger) competing players on the energy market. In

result, the REC shall be enabled to

• produce, consume, store and sell renewable en-

ergy,

• share produced renewable energy within the com-

munity,

• and access energy markets in a non-

discriminatory manner.

Its participants have to incorporate an autonomous le-

gal entity, effectively controlled by them. They have

to be located in the REC’s proximity, which requires

a clariﬁcation in the national implementations by ei-

ther applying technically or geographically deﬁned

boundaries. Furthermore, participation is open and

voluntary, and shall also be open to indigent partic-

ipants. In contrast to CECs, RECs are not limited to

electricity, but could operate on all kinds of renewable

energy (e.g., heating, cooling). Still, there are some

open questions remaining, not only for the legal pro-

cess; for instance, a desired minimum or maximum

size of a community, a speciﬁcation about the desired

mix of producers and consumers within a community,

the desired ‘environmental, economic, or social com-

munity beneﬁts’ for the community itself, its partici-

pants, and the general public, etc.

2.3 National Implementations

National implementations of the directives are due

partly at the end of 2020 (e.g., the ED II), partly at

the end of June 2021 (e.g., the RED II). Some open

issues have been identiﬁed to remain open for the na-

tional adoption (cf. (Cejka, 2020)). Frieden et al.

provided a technical report on the current state of the

implementations of collective self-consumption and

energy communities into national law in June 2019

(Frieden et al., 2019). Accordingly, of 15 investigated

Europen Union member states, 7 already have legal

frameworks for collective self-consumption, only 3

for energy communities. However, legislative pro-

cesses for national implementations have been started

in some member states. Especially once approaching

the implementation deadlines, signiﬁcant changes to

the report’s described state need to be considered.

3 BLOCKCHAIN

The use of blockchain technology is increasingly dis-

cussed and introduced in many areas (Casino et al.,

2019), including the energy sector (Andoni et al.,

2019; Alladi et al., 2019; Ahl et al., 2020). Pro-

leptic to national legal adoptions of RECs, research

projects are engaging with REC implementations us-

ing blockchain technology. As already done by many

authors, this paper will skip an introduction into

blockchain technology. In this regard, we want to es-

pecially point to (Joint Research Centre, 2019; Finck,

2019a) introducing and covering various aspects of

blockchain technology. However, privacy issues with

blockchain technology are well-known and necessar-

ily need to be taken care of in these projects. Though

using blockchain technology seems to be incompat-

ible with privacy law at ﬁrst sight, there are options

to stay compatible. As many authors previously en-

gaged with privacy issues in blockchain technology

(e.g., (Finck, 2019a)), this paper will only focus on a

few picked aspects of special interest within the use

case.

3.1 Privacy Aspects

The General Data Protection Regulation (GDPR) is

the main European Union’s privacy act. As in the

form of a regulation act, it is directly applicable in

all 27 member states. It is applicable only for ‘per-

sonal data’ of a data subject, i.e., ‘any information

relating to an identiﬁed or identiﬁable natural per-

son’. In fact, households’ energy consumption data

are personal data, as they could reveal much of per-

sonal habits when recorded in high frequencies, for

example, by Smart Meters (Tang et al., 2015; Grev-

eler et al., 2012). Due to their increasing roll-out

around the globe, many authors have previously been

engaged with their privacy issues (Cejka et al., 2019;

Martinez et al., 2019). For energy communities, a

high frequency read-out of energy production and

consumption will be necessary; participants will thus

be required to be equipped with a Smart Meter.

3.1.1 Identiﬁcation of the Data Subject

A person is identiﬁable if it can be unmistakably iden-

tiﬁed with any available means, including the combi-

nation with additional available information in order

A Blockchain-based Privacy-friendly Renewable Energy Community

to establish a concrete reference to a person. Accord-

ing to the GDPR, all means ‘reasonably likely to be

used’ to identify the respective natural person directly

or indirectly are included in this context, taking ob-

jective factors such as cost and time involved as well

as available technical means into account. Data that

is not traceable to any individual is ‘anonymous data’

and thus not subject to privacy law. It should be noted

that pseudonymized data also falls under the term of

personal data and that the GDPR remains applicable.

Encrypting data is also only a form of pseudonymiza-

tion that does not remove the reference to an individ-

ual.

The application at hand requires to keep the as-

signment of individuals with their energy production

and consumption data, as well as the involved par-

ties in their energy trades. It is expected, that – at

least for the time being – the number of participants

in RECs will be limited. Therefore, the assignment

to a speciﬁc subscriber is easily possible even when

using pseudonyms. Furthermore, for energy com-

munities most probably a private and permissioned

blockchain is used rather than a public and permis-

sionless blockchain; i.e., only authorized entities have

access to the blockchain and those entities need to be

authorized to execute transactions rather than permit-

ting anyone. Thus, by design an authority is required,

that is responsible for adding participants to and re-

moving them from the blockchain, as well as to de-

ﬁne proper roles for them. This authority necessar-

ily needs to maintain an exact mapping between indi-

viduals and their blockchain pseudonyms’ represen-

tation.

3.1.2 The Controller

According to the GDPR, the ‘controller’ ‘determines

the purposes and means of the processing of personal

data’. Its main duty is to take appropriate technical

and organisational measures to ensure adequate pro-

tection for privacy risks. Furthermore, it is required to

ensure that only personal data is processed whose pro-

cessing is required for the particular purpose. How-

ever, in blockchain applications, it is not a priori clear

who serves as this controller. Eligible characters are

the application’s programmer, the application’s ini-

tiator, every participant executing a transaction, the

miner, or the node operator (EU Blockchain Observa-

tory and Forum, 2018). Depending on the use case ei-

ther none, one, or more of the mentioned options can

serve as the controller. In result, the question on who

is in charge can only be answered for a concrete use

case, but not for blockchain applications per se. If all

nodes are considered as controllers, they are neverthe-

less no ‘joint controllers’ according to the GDPR, as

they do not ‘jointly determine the purposes and means

of processing’ (Finck, 2019a).

3.1.3 Rights of the Data Subject

The GDPR stipulates various rights of the data sub-

ject, which the controller is responsible to fulﬁll.

Among them are the ‘right to rectiﬁcation’ and

the ‘right to erasure’, which are of special interest

in blockchain applications due to their technology-

intrinsic immutability of persisted data. Later modiﬁ-

cations or even deletions of data on the blockchain are

thus not possible. This immutability aspect is one of

the biggest advantages of the blockchain from a tech-

nical point of view, but critical from the data protec-

tion perspective. Thus, special technical and organi-

sational measures need to be taken to ensure suitable

fulﬁllment of those rights.

Principles. In this context, some principles of the

GDPR need to be mentioned: Pursuant to the prin-

ciple of storage limitation, personal data may only

be kept for as long as necessary in regard of the pur-

poses they were collected for. This requires in partic-

ular that the storage period for personal data is limited

to the absolutely necessary minimum. Close-by, pur-

suant to the principle of data minimization, only the

minimum required personal data for the speciﬁc use

case shall be collected.

Access and Information. The data subject has the

right to know whether and to what extent its personal

data is processed by whom and for which purposes.

This right of information is the central right in order

to claim further rights, for example, the right to recti-

ﬁcation, erasure etc.

Amendment. The GDPR requires all personal data

to be accurate and up-to-date. Thus, every reasonable

step with regard to the speciﬁc technology must be

taken to correct wrong data. However, modiﬁcations

of old data on the blockchain are not possible. Thus,

it may be sufﬁcient to add the new corrected data as a

supplementary statement (Finck, 2019a), though still

keeping the old outdated data on the blockchain.

Erasure. If a person no longer wishes their data to

be processed and there is no legitimate reason to re-

tain it, its personal data must be deleted by the con-

troller. Furthermore, the controller is obliged to take

‘appropriate measures’ to inform other controllers

and processors of the data subject’s request. However,

as the GDPR contains no clear deﬁnition of erasure,

it can be argued that the requirements are not placed

SMARTGREENS 2020 - 9th International Conference on Smart Cities and Green ICT Systems

too high. It is arguable to be sufﬁcient if the particular

personal data becomes unrecognisable for the proces-

sor, i.e., to become illegible or to be no longer avail-

able. Furthermore, a supplementary statement disal-

lowing its further processing may be reasonable.

There are proposals for introducing mutability

into the blockchain (Politou et al., 2019; Ateniese

et al., 2017); however, we disapprove to discard main

blockchain principles such as its immutability aspect.

Thus, access should be blocked – in an appropriate

technical way – without the need to destroy individual

data records or change the blockchain’s principles.

3.1.4 Data Protection Impact Assessment

GDPR contains the fundamental ideas of ‘privacy by

design and by default’ to ensure a correct handling

of personal data in every use case ab initio. Thus,

the immutability of persisted data on the blockchain

can be considered early in the design of the use cases.

The GDPR requires to carry out a ‘data protection im-

pact assessment’ (DPIA) prior to the data processing

if it ‘is likely to result in a high risk to the rights and

freedoms of natural persons’, in particular when us-

ing new technologies. The Article 29 Data Protec-

tion Working Party has issued additional guidelines

for criteria in which a high risk can be assumed, which

include (Article 29 Data Protection Working Party,

2017):

• data processing on large scale (concerning the

number of concerned data subjects, the volume of

data processed, the duration or permanence of the

data processing activity, the geographical extent

of the processing activity),

• innovative use or applying new technological so-

lutions,

• when processing prevents data subjects from ex-

ercising a right.

In our opinion, especially the listed criteria are appli-

cable to solutions utilizing blockchain technology as

a ‘new technology’. According to the GDPR, a DPIA

needs to contain at least:

• a description of the envisaged processing opera-

tions and their purposes,

• an assessment of the necessity and proportionality

of the processing operations,

• an assessment of the risks to the rights and free-

doms of data subjects, and

• the measures envisaged to address the risks.

The DPIA needs to be carried out by the controller.

However, in our opinion this should be the duty of

the initiator of the blockchain application, as this cor-

responds best to the fundamental ‘privacy by design’

idea.

3.1.5 Smart Contracts

When using ‘smart contracts’, a program code trig-

gers an action once an event matches a corresponding

contract content without further human intervention.

Participants determine desired parameters, for exam-

ple, at which price how much electricity shall be pur-

chased or sold. As soon as matching declarations of

intent of two contracting parties are recognized, the

contract is automatically concluded (‘matching’), ex-

ecuted on-chain and cannot be rolled-back.

The RED II contains a deﬁnition for ‘peer-to-

peer trading’, which – in our opinion – sounds a lot

like considering smart contracts for trading (renew-

able) energy between self-consumers and within en-

ergy communities. It is deﬁned as ‘the sale of renew-

able energy between market participants by means

of a contract with pre-determined conditions govern-

ing the automated execution and settlement of the

transaction’. Listed among the DPIA criteria of the

Article 29 Data Protection Working Party report is

also the ‘automated-decision making with legal or

similar signiﬁcant effect’ (Article 29 Data Protec-

tion Working Party, 2017). Furthermore, the Article

29 Data Protection Working Party issued an own re-

port on automated individual decision-making (Arti-

cle 29 Data Protection Working Party, 2018). Only

recently, Finck dealt with privacy-related questions of

smart contracts, that can be subsumed under GDPR’s

regulation on ‘automated individual decision-making’

(Finck, 2019b). According to GDPR, the data subject

has the right ‘not to be subject to a decision based

solely on automated processing’ producing legal or

similarly signiﬁcant effects. This does not apply, if

the decision

• is necessary for entering into, or performance of, a

contract between the data subject and a data con-

troller;

• is authorised by law, which also lays down suit-

able measures to safeguard the data subject’s

rights and freedoms and legitimate interests; or

• is based on the data subject’s explicit consent.

It needs to be noted, that smart contracts are not nec-

essarily concluded between the data subject and the

controller only. However, there are opinions that de-

ﬁne the publisher of a smart contract, or anyone ex-

ecuting this contract (i.e., in essence, every node) as

a controller (EU Blockchain Observatory and Forum,

2018). Furthermore, smart contracts are neither smart

A Blockchain-based Privacy-friendly Renewable Energy Community

in sense of AI nor contracts in the legal sense (Finck,

2019b). In essence, they are if/then relations only,

computer code that may nevertheless produce legal

effects.

Numerous regulations, for example, of civil law,

data protection law, consumer protection law, tax law,

e-commerce law etc., have to be taken into account

within the framework of smart contracts, which can-

not, however, be elaborated further in this study.

3.2 Energy Efﬁciency

Energy communities aim to improve local energy efﬁ-

ciency, yet blockchains are in fact not known for pro-

viding an energy efﬁcient operation (de Vries, 2018;

Vranken, 2017). It is estimated that the cumula-

tive energy consumption of blockchains already ex-

ceeds the energy consumption of medium-sized coun-

tries. This is due to the enormous use of energy

for the ‘proof-of-work’ consensus protocol, imple-

mented, for example, in the probably best known

blockchain – the Bitcoin blockchain (Joint Research

Centre, 2019). According to University of Cam-

bridge, the energy consumption of this blockchain

alone currently already exceeds those of countries

such as Finland, Belgium, or Austria (University of

Cambridge, 2020). For energy community applica-

tions, however, we do not require a big blown pub-

lic blockchain. We thus use the ‘proof-of-authority’

consensus protocol, utilizing a subset of blockchain

nodes, trusted to generate new blocks on the chain on

behalf of all nodes.

4 A PRIVACY-FRIENDLY

BLOCKCHAIN-BASED

ENERGY COMMUNITY

The result of the privacy considerations is to avoid

persisting personal data on a blockchain whenever

possible. To mitigate data protection issues, the

use of a combined system with a classic distributed

database is often proposed (Zyskind et al., 2015; EU

Blockchain Observatory and Forum, 2018). Thus,

personal data are saved off-chain; pointers to those

data records and their hash values are saved on the

blockchain. Modiﬁcations are possible in the data

base while keeping the pointer on the blockchain in-

tact. They can be identiﬁed by comparing the per-

sisted initial hash value on the blockchain with the

current one. Deletions in the data base will result

in the pointer pointing to an empty cell. In this re-

gard, we do not count hash values as personal data

anymore as proper hash functions do not allow to de-

duce back to the original personal data value. How-

ever, this opinion is not yet clariﬁed as some sources

do see hash values as pseudonymized data only which

would not suspend the applicability of the GDPR

(Finck, 2019a; Article 29 Data Protection Working

Party, 2014).

If it cannot be avoided to save personal data

on the chain itself, additional technical and organ-

isational measures, for example, pseudonymization,

anonymization, encryption, must be taken. In that

case, accurate handling of encryption keys need to be

guaranteed, including the proper dismissal of those

keys on a deletion request.

4.1 Architecture

The described solution uses a different approach by

only temporarily storing personal energy consump-

tion data. This architecture (Figure 2) intends to meet

the requirements for operating an REC as well as of

data protection. The central element is a permissioned

blockchain, which limits the number of participants.

New participants must be added by a central author-

ity, such as the community’s operator or administrator

(‘community representative’).

The proof-of-authority process is used as a con-

sensus algorithm for the formation of new blocks,

in which only certain assigned participants (so-

called ‘sealers’) write encrypted transactions into the

blockchain. In addition to these sealers, there can

also be ‘full nodes’ that also store a full local image

of the blockchain (‘Node DB’), but do not necessar-

ily have to be a community participant

. The nodes’

task is to enable the operation and updating of the

blockchain for the community. It is assumed that in

addition to the actual operator, other parties are ac-

cepted by the participants to also operate a node (e.g.,

the energy regulator or other legal authorities). In the

proposed approach, the distribution system operator

(DSO) also operates a node in order to be able to pro-

cess grid capacity releases via the blockchain. Nodes

can be added or removed dynamically; in the proof-

of-authority process sealers generate blocks in a de-

ﬁned sequence; in case of the particular sealer failing,

the block is formed by the next sealer.

The infrastructure server is operated and main-

tained by the infrastructure manager of the commu-

nity, which may also be the DSO. The task of this

server is the distribution of the information necessary

for the operation of the blockchain, the active smart

contracts, the conﬁguration of the participants and of

Sealers and full nodes are summarized in Figure 2 and

below as ‘nodes’.

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100

Figure 2: Structure of the privacy friendly blockchain implementation of an energy community.

the nodes. In addition, roles are assigned to the indi-

vidual participants to determine access rights to data

within the blockchain. An assignment of real cus-

tomer data to the pseudonym in the blockchain is only

possible for the infrastructure manager as administra-

tor. This is necessary in order to be able to transmit

billing-relevant information to the operator. Data is

stored in encrypted form, thus it can be read out by

authorized persons only. Along with that all data is

exchanged via encrypted connections to ensure maxi-

mum data security.

In contrast, end customers as well as local pro-

ducers are connected to the blockchain as so-called

clients only. Customers equipped with their own

photovoltaic installation are termed ‘prosumers’ in

combination. Their connection is made exclusively

via measuring devices and other sensors or actua-

tors. These hardware elements determine the energy

or power ﬂows of the participants into or from the

distribution grid. They write these measurements as

encrypted data into the blockchain, using appropri-

ate data processing and the communication infrastruc-

ture. Clients do not store a complete image of the

blockchain, only as far as they require data for the ex-

ecution of transactions. If data from the blockchain

must be passed on to other devices (e.g., to control a

charging station for electric vehicles), this is also done

via a secure connection (‘Protected Control’).

By utilizing blockchain technology, stored infor-

mation (e.g., invoices) can be made available to the

participants in a traceable and transparent manner at

all times. This creates a high level of acceptance of

the technology and trust among the participants. Ac-

cess to data of the participants is possible in accor-

dance with deﬁned access rights via a web servers

or ‘Gateway’ operated by the individual nodes. Ex-

amples of such data are measurements, sales or pur-

chases in or from the community or the storage use

of a central battery storage system. The implemented

gateways also offer the option of accepting customer

settings and forwarding them to the smart contracts

(e.g., whether the participant favors to save his sur-

pluses in the battery system for its own later use or

if the surplus should rather be distributed within the

community).

Peer-to-peer trading within the energy community

and the use of the battery system are fully automated

by executing smart contracts in the blockchain. Tak-

ing the access rights into account, additional tools

(e.g., ‘Smart Contract / Contract Design’) can be con-

nected via a ‘Gateway’. Authorized agents can ob-

serve and analyze energy ﬂows and thereby draw con-

clusions for an improvement in the community’s op-

eration.

4.2 Implementation in Relation to Data

Protection

Due to the previously mentioned technical implemen-

tation and the management of the energy community

A Blockchain-based Privacy-friendly Renewable Energy Community

101

by the DSO, it is identiﬁed as the responsible entity

for data protection (‘controller’) in the proposed sys-

tem. While this remains questionable regarding smart

contracts, the stipulation of the DSO as infrastructure

operator does not rule out that there may be other en-

tities responsible for a speciﬁc application.

Based on the use cases listed, the following data

can be derived, which the REC participants store in

pseudonymized form in the blockchain:

• actual energy values in high time resolution,

• amount of energy sold to other energy community

participants,

• purchased amount of energy from other energy

community participants,

• amount of energy stored in the central storage sys-

tem,

• amount of energy retrieved from the central stor-

age system.

In addition to the amount of energy, information about

the energy price is stored in order to enable billing and

to make this data transparent and available to every

participant. Unlike the aforementioned energy data,

which can be assigned to the respective community

participant, price data does not belong to the category

of personal data and is therefore not covered by data

protection laws.

Subsequently, in accordance with the data min-

imization principle, the purpose for which personal

data is collected or processed needs to be determined:

• execution of the smart contracts (e.g., for handling

peer-to-peer trading of energy, for the usage of

central storage system, for the allocation of net-

work resources or for the release of network ca-

pacities),

• billing of local energy trading within the energy

community,

• enabling the traceability of storage usage (e.g., as

proof for potential lessors of a battery system and

their users),

• provision of billing-relevant information and data

for the user (e.g., for control of the running sys-

tem, motivation of the participants, basis for deci-

sions regarding participant behavior)

Regarding the storage limitation principle, data is

only stored on the blockchain for the duration of an

accounting period (e.g., one month). At the end of the

billing period, the start of a new blockchain is initiated

by the infrastructure server (‘Infrastructure’ in Figure

2). The old blockchain is then archived in a database

(‘Archive DB’) and its hash value is stored as an ini-

tial transaction in the new blockchain to keep a proper

link to it. Since reading out energy data is required

for the operation of the energy community far more

often than it is legally deﬁned for households, a clear

consent to participate is required which could also be

revoked at any time (Cejka et al., 2019). Participants

can leave the energy community in this way as legally

deﬁned to be always possible in the RED II. Consid-

ering this step that may include a request to erasure

of personal data according to the GDPR, the data of

the former participant will not be available in the next

blockchain. Prior to the next blockchain round, pro-

cessing of his personal data must be restricted.

It may be legally required to keep archived

blockchains saved for up to some years accord-

ing to civil and tax law regulations. If individual

blockchains were deleted from the archive, energy

trading can no longer be fully retraced. Thus, only the

billing information would be available, but not how it

was determined.

5 CONCLUSION

As part of the ’Clean Energy for all Europeans Pack-

age’, energy communities – beside other plans in the

package – shall allow individuals to take an active

part in the energy transition. Contained in the Eu-

ropean Union’s revised Renewable Energy Directive

of 2018 and the Electricity Directive of 2019, the de-

scribed implementation of an energy community an-

ticipates their adoption into national law. As those

national transpositions are due 2020/2021, this area is

expected to be in signiﬁcant motion within near fu-

ture.

Although using blockchain technology, which is

known for raising privacy questions, we have shown

a privacy-friendly implementation that allows to en-

force the ’right to rectiﬁcation’ and the ’right to era-

sure’ in a feasible way. It has been rolled-out in a

small municipality in Styria, Austria, where the im-

plementation is currently ﬁeld-tested with real cus-

tomers. Results of this ﬁeld test will be part of a

subsequent publication. While in the related projects

only the type of ‘renewable energy communities’ was

examined, this implementation would also be utiliz-

able in a ‘citizen energy community’. As this type

of energy communities is not restricted to a deﬁned

proximity, a high number of participants may be in-

volved that may be spread widely.

SMARTGREENS 2020 - 9th International Conference on Smart Cities and Green ICT Systems

102

ACKNOWLEDGMENTS

The presented work is conducted in the projects Sonn-

Wende+ (FFG 2808377) and Blockchain Grid (FFG

3089755), funded by the Austrian Climate and En-

ergy Fund (KLIEN) and the Austrian Research Pro-

motion Agency (FFG).

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