1Q 2019

Blockchain Establishes a Secure Foundation for Distributed Systems Management

The Energy Cloud transformation is characterized by complex systems of distributed, digital, and heterogenous assets. As the number of interconnected devices in distributed systems grows, the centralized command and control model must give way to a decentralized framework that increasingly relies on automated processes at the grid edge. As the role of automation grows, distributed systems operators must develop a framework for device-level trust to avoid creating new vectors for cyber attacks, fraud, or network manipulation while continuing to provide a high quality experience to end users.

Navigant Research expects that blockchain and distributed ledger technologies will play a key role in creating a secure foundation for edge computing and distributed intelligence. Blockchain augments existing systems management technologies with an authentication layer that enables devices in a network to constantly verify each others’ identity, location, state, and status. System operators can further expand their capabilities by combining blockchain with parallel technologies such as machine learning, artificial intelligence, and cybersecurity suites. Multiple partnerships between utilities and blockchain technology companies are exploring applications for blockchain in this space, from straightforward cybersecurity applications to entirely new models for balancing the grid.

This Navigant Research report explores the drivers behind the evolution of distributed systems management in the Energy Cloud and focuses on the role blockchain plays in creating a framework for device-level trust. The report examines the push for performance-based utility evaluation around the world and the strains that rapidly increasing volumes of data are placing on systems operators, emphasizing that blockchain is one piece of a larger strategy to adapt to these changes. It concludes with recommendations for anticipating this evolution in grid management and explores blockchain’s role in that context.

Pages 17
Tables | Charts | Figures 3
  • What is a distributed system?
  • How do the trends of distribution, decentralization, and digitization affect distributed systems?
  • Why is device-level trust an essential component of distributed systems management?
  • How can blockchain and distributed ledger technologies establish device-level trust?
  • What kinds of applications and business models can be built atop a network of trusted devices?


  • Advanced distribution management system vendors
  • Smart grid hardware and software vendors
  • Distributed system operators
  • Grid cybersecurity service providers
  • Energy service providers
  • Investor community

Spark

Context

Recommendations

Distributed Systems Are Rapidly Evolving

Utility Distribution Networks are Distributed Systems

Systems Management in the Energy Cloud Paradigm

Performance-Based Regulatory Regimes Pressure System Operators

Modern Distribution Grids Are Complex, Intelligent Systems

Distributed Intelligence Can Optimize Systems Management

Complex Digital Systems Are Vulnerable to Attack

Blockchain Provides a Mechanism for Data Authentication

Blockchain Provides a Framework for Device-Level Trust

Blockchain Architectures Add an Authentication Layer to Key Data Streams

Blockchain Builds Automated Process on Top of a Trusted Network

Smart Contracts Can Improve Efficiency and Reduce Costs for Some Processes

Blockchain Will Benefit from the Development of Related Technologies

Blockchain Can Be a Platform for Distributed Systems Operations

Transactive Energy Is an Early Building Block for Distributed Systems Management

Trusted Data Is Key for Distributed Systems Management

DSOs Must Break Down Technological and Organizational Barriers

Blockchain Can Contribute to Distributed System Security Now

Do Not Pursue Blockchain to the Exclusion of Related Technologies

Partner Early and Often, Wait for Separation to Make Acquisitions

  • Complex, Interconnected Services in the Energy Cloud
  • Building a Secure Foundation for Automated Processes
  • Half of Energy Blockchain Organizations are Pursuing TE, DSM, or Both
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