ReCert Framework for Decentralized Blockchain-Enabled Transactive Energy (BCTE)

This paper introduces ReCert, a foundational framework designed to enable decentralized Blockchain-Enabled Transactive Energy (BCTE) by leveraging Self-Sovereign Identity (SSI) and a hybrid architecture combining IOTA’s DLT and Concordium’s blockchain. ReCert addresses the blockchain trilemma (scalability, security, decentralization) and facilitates granular, prosumer-driven energy certificate management.

Key Components of the Framework

1. Self-Sovereign Identity (SSI):

   • Enables decentralized identity management through Decentralized Identifiers (DIDs) and Verifiable Credentials (VCs).
   • Prosumers autonomously manage identities and certificates, eliminating reliance on centralized authorities.

2. Granular ReCert Certificates:

   • Operate at fine-grained levels (e.g., kWh) to support small-scale renewable energy producers (e.g., residential solar panels).
   • Sliceable design allows flexible aggregation and trading.

3. Hybrid DLT-Blockchain Architecture:

   • IOTA Tangle: Handles high-volume, feeless transactions for certificate issuance and aggregation.
   • Concordium Blockchain: Anchors Merkle Tree root hashes for immutable verification and serves as the single source of truth.

4. Merkle Tree Structure:

   • Aggregates certificates hierarchically, enabling efficient verification and integrity checks.
   • Root hashes are anchored on Concordium to minimize blockchain usage and costs.

5. Prosumer-Driven Aggregation:

   • Shifts certificate aggregation from centralized registries to prosumer meters, enhancing decentralization.

How ReCert Works

Certificate Lifecycle:

1. Creation: Prosumer meters generate ReCert certificates as SSI-based VCs for renewable energy production.
2. Ownership Transfer: Certificates are traded globally via SSI standards, enabling cross-registry transactions.
3. Retirement: Certificates are retired upon use for Scope 2 emissions, removing them from circulation.

Aggregation & Verification Process:

1. Aggregation: Prosumers aggregate certificates into Merkle Trees using IOTA’s indexing and submit them to registries.
2. Re-Certification: Registries validate aggregated certificates and anchor Merkle Tree root hashes on Concordium.
3. Auditing: Auditors verify certificates via Merkle proofs and blockchain-anchored data without registry involvement.

Addressing the Blockchain Trilemma

• Scalability: IOTA’s DLT manages high-throughput transactions at the prosumer level.
• Security: Concordium’s blockchain ensures immutability and acts as a tamper-proof ledger.
• Decentralization: SSI and prosumer-driven aggregation eliminate centralized trust points.

Advantages Over Existing Systems

1. Decentralized Trust:

   • Replaces centralized registries with SSI and blockchain, aligning with BCTE’s decentralization promise.

2. Cost Efficiency:

   • IOTA’s feeless model reduces operational costs for small-scale prosumers.
   • Bulk anchoring of Merkle Trees minimizes blockchain transaction fees.

3. Interoperability & Flexibility:

   • SSI-based certificates enable cross-border trading and integration with global EAC standards (e.g., REC, REGO).

4. Scalability for Developing Nations:

   • Supports phased BCTE adoption in regions with limited smart metering infrastructure (e.g., transformer-level integration in Pakistan).

5. Enhanced Transparency:

   • Public blockchain anchoring and SSI ensure auditable, tamper-proof records.

Comparative Analysis with Existing Solutions

• Traditional RECs: Limited to MWh units and centralized management; ReCert enables kWh-level granularity and decentralization.
• Hybrid Systems: ReCert reduces reliance on pre-trusted registries and optimizes Merkle Tree usage for cost efficiency.
• NFT/SFT-Based Solutions: SSI outperforms rigid NFTs by enabling sliceable certificates.

State of the Art

ReCert builds on prior work in decentralized energy certification but introduces:

• Prosumer-Driven Aggregation: Shifts control to end-users.
• Hybrid DLT-Blockchain Integration: Balances scalability and security.
• SSI-Based Lifecycle Management: Ensures privacy and verifiability.

This framework lays the groundwork for a fully decentralized BCTE ecosystem, addressing critical challenges in energy certification while fostering global sustainability efforts.