  Smart grid is a large complex network with a myriad of vulnerabilities,
usually operated in adversarial settings and regulated based on estimated
system states. In this study, we propose a novel highly secure distributed
dynamic state estimation mechanism for wide-area (multi-area) smart grids,
composed of geographically separated subregions, each supervised by a local
control center. We firstly propose a distributed state estimator assuming
regular system operation, that achieves near-optimal performance based on the
local Kalman filters and with the exchange of necessary information between
local centers. To enhance the security, we further propose to (i) protect the
network database and the network communication channels against attacks and
data manipulations via a blockchain (BC)-based system design, where the BC
operates on the peer-to-peer network of local centers, (ii) locally detect the
measurement anomalies in real-time to eliminate their effects on the state
estimation process, and (iii) detect misbehaving (hacked/faulty) local centers
in real-time via a distributed trust management scheme over the network. We
provide theoretical guarantees regarding the false alarm rates of the proposed
detection schemes, where the false alarms can be easily controlled. Numerical
studies illustrate that the proposed mechanism offers reliable state estimation
under regular system operation, timely and accurate detection of anomalies, and
good state recovery performance in case of anomalies.
