# Software Defined Networking Architecture for Energy Transaction in Smart Microgrid Systems
## 3 Software-Defined Network (SDN) for Transactive Energy in SMGs
However, their research showed that placing a controller closer to the SDN switches provided an optimized shortest path between the SDN controller and the SDN switches. A network consists of multiple network elements and connections that can influence the reliability and availability of the data path, confirming the importance of the SDN controller placement. To improve the reliability of the SDN architecture, a decentralized SDN controller placement needs to be considered. Another consideration to improve the availability of a data path is to limit the number of point-of-failures (POF) or the number of circuits between SDN nodes. [PERSON] et al. [29] state that the expression for reliability (\(R(t)\)) is a function of the failure rate (\(\lambda(t)\)) over time. The expression is independent of the law of variation of failure rate, i.e., constant failure rate. Therefore, a network's availability is the product of the availability of all the POFs in the network. The availability is, therefore, inversely proportionate to the number of POFs. As the number of POFs decreases, the availability increases. When availability increases, then the reliability improves. An SDN node in an SDN network may have multiple connections to the network, and redundancy is another method to reduce the failure rate of the data path that will improve the reliability of the data path. By dynamically changing the data path due to a link failure at the SDN node, the downtime of the data path reduces, which in turn increases the availability of the data path. A redundant path configuration in the SDN architecture, therefore, improves the reliability of the data path. [PERSON] et al. [30] simulate FAVE, a bandwidth-aware and seamless failover mechanism for SDN network virtualization. They can successfully simulate a data transfer between two tenants with two links (tenant routes (TR)), during which the active TR 'fails' and the second TR seamlessly continues with the data transfer. Flexibility in SDN is the ability to adapt to different types of network technologies and network conditions. For example, [PERSON] [31] optimizes the control of a hybrid IP/SDN network through a generic algorithm (GA) that effectively conserves energy consumption of the different nodes in the network. The algorithm considers specific parameters, and [PERSON] identified two strategies, the most noncontrolled link first (MNL) and least noncontrolled link first (LNL). Both strategies show how a control algorithm can improve network flexibility by adapting to controllable and noncontrollable network elements. Another approach to improve flexibility is to create a mesh network of nodes that enables multiple paths between two nodes, especially in a mesh network architecture. Determining the shortest path between any two nodes is a well-known problem in operational research, according to [PERSON] et al. [32]. A typical real-world example of the shortest path problem is determining the quickest route through a city or country. Well-known online and mobile map applications solve the problem through shortest-path algorithms. [PERSON] et al. [32] review the Floyd\(-\)Warshall algorithm in a mesh network to calculate both the shortest cost and shortest route between pairs of nodes. The ability to adapt the routing algorithm in an SDN increases the flexibility of the network by providing the optimal communication path. [PERSON] et al. [33] explain that this can be achieved by changing the location, the frequency, and the way of the routing algorithm. The advantage of SDN that simplifies the Integration of SDN nodes into an SDN network is mainly due to SDN's visually open network architecture, which is a security concern in a public network environment. The traditional IP network architecture utilizes several security protocols that include VPN (virtual private network), internet protocol security (iPsec), generic routing encapsulation (GRE), and cloud-based services such as FWaaS (firewall-as-a-service).