# The Potential of Blockchain Technology and Smart Contracts in the Energy Sector: A Review
## 3 Research Methodology and Literature Classification
### Literature Classification
#### 3.2.1 Energy Market and Regulations (EMnR)  
The category \"Energy market and regulations\" focuses on the policies, regulations, and specific market mechanisms governing the energy sector. The subcategories identified in this category are as follows:  
* Energy transactions and market mechanisms: This subcategory deals with the various mechanisms involved in energy trading, such as spot, futures, and derivatives markets. It also encompasses the different types of market participants, such as producers, suppliers, and consumers. * Energy policy and governance: Deals with the various policies and governance structures that affect the energy sector. It includes government policies related to energy security, energy efficiency, and renewable energy issues. * Market design and pricing mechanisms: This subcategory focuses on the design of energy markets and the pricing mechanisms used to set energy prices. It tackles issues such as capacity markets, price caps, and auctions. The study of [PERSON] [33] reviews how blockchain technology has been, and can be, deployed in energy applications. It also studies the existing architectures and solutions, and existing and emerging security and privacy challenges. This paper tackles the challenges posed by the transition to renewable energy sources, the need for decentralized energy systems, and the promotion of carbon emission reduction through trading mechanisms. One of the main findings of the paper is that blockchain technology has been, and can be, deployed in a variety of energy applications, such as energy management, peer-to-peer trading, electric vehicle-related applications, and carbon emissions trading. \begin{table}
\begin{tabular}{c c c c} \hline \hline
**Paper Title** & \multicolumn{2}{c}{**Main Focus and Contributions**} & \multicolumn{2}{c}{**Technical Environment**} \\ \hline Vulnerabilities and excess gas consumption analysis within & - & Empirical analysis and tool evaluations for smart contract security & - & Ethereum (EVM) \\ Ethereum-based smart contracts for electricity market [35] & - & Vulnerabilities and gas expenditure optimization & - & Solidity \\ Modeling of smart contracts in blockchain solution for renewable energy grid [65] & - & PoC implementation & - & Corda \\ \hline \hline \end{tabular}
\end{table} 
Table 2: _Cont._ \begin{table}
\begin{tabular}{c c} \hline \hline
**Common Technical Challenges** & **Papers—Studies** \\ \hline Security and/or Privacy Issues in Smart Energy Networks & [33; 40; 44; 59; 62; 63] \\ Management and Integration in Energy Systems and Blockchain & [28; 39; 42; 43; 45; 47; 48; 53; 55; 57] \\ Technical Issues in Energy Transactions and Markets & [26; 27; 29; 38; 51; 56; 58; 56; 58; 60; 61] \\ Implementation of Blockchain Technology and Smart Contracts & [26; 30; 31; 34; 35; 64; 65] \\ Renewable Sources and Efficiency in Energy Production & [32; 36; 37; 38; 41; 46; 50; 52] \\ \hline \hline \end{tabular}
\end{table} 
Table 3: Common technical challenges identified. [PERSON] et al. in [38] discuss Ethereum-based smart contracts that facilitate dual energy auctioning and negotiation of spinning reserves. The efficiency of the contracts in executing the auction process and making payments is validated using an energy/reserve market scenario. The paper addresses the need for a transition to renewable energy sources, the inefficiencies and high transaction costs associated with centralized energy trading systems, and concerns related to data privacy, scalability, and security. The main findings of this paper are that a blockchain-based smart contract is well suited to transparently facilitate transactions between consumers and energy producers without the services of intermediaries. Ethereum-based smart contracts are also being developed to facilitate dual auctioning of energy and trading of spinning reserves. Finally, the proposed system encourages further adoption of distributed energy resources and participation in local P2P energy transactions.