Blockchain has been termed as a solution for many problems ranging from health care, sports to legitimizing the black market in the US Prison System. While some use cases are definitely more tenuous than others, there is currently a lot to hope for in blockchain climate change solutions.
CLIMATE CHANGE PROBLEM GRADUALLY GETTING WORSE
In October 2018, the United Nations issued it’s severe warning on climate change. Yet, we have only about 12years left to restrict global warming to a maximum of 1.5 C (2.7 F) in comparison to pre-industrial levels. Half a degree more than this will bring a far worse risk of severe heat, drought, and floods. Also, the damage caused by climate change is expected to displace more than 143 million people over the next three decades and will ultimately be forced to flee their homes to escape climate-related issues.
The Paris Agreement on climate change focuses on limiting the increase to less than 2 C. So, achieving the 1.5 C rise is at the ambitious end of the existing commitment. The Paris Agreement needs each country to define it’s own contributions to the efforts to restrict climate change. The contribution of each country is called a National Determined Contribution (NDC). Each nation must ensure it’s aim becomes progressively more ambitious over time. It is very significant to note that the Paris Agreement has no legal enforceability and each country participates through consensus. If countries start to leave, the agreement could fall apart and leave the world without any solution to the problem of increasing global temperatures.
HOW CAN BLOCKCHAIN HELP
Tracking and measurement are the main challenges in solving the problem of climate change. This does not just apply at the macro level needed to verifying how nations are progressing in their efforts to reduce carbon emissions. People and their different businesses also have to participate. In the words of a major management expert Peter Drucker; “What gets measured, gets managed”. Blockchain gives a means of establishing a single point of truth between entities via the application of consensus methods. Real world assets can also become tokenized on the blockchain, including greenhouse energy or carbon credits. These assets are very much tradable, creating value and incentivizing climate change efforts within nations and enterprises.
The United Nations in January 2018, announced the formation of the Climate Chain Coalition. The announcement portrayed the mission of the group in “advancing collaboration among members working on problems of common interest, and to also aid in the enhancement of the environmental integrity and results of DLT applications for the climate.” The coalition currently has over a hundred members, including NGOs, consulting firms, and various blockchain companies and associations.
EFFORTS OF BLOCKCHAIN CLIMATE CHANGE
With the efforts of the UN, it seems unquestionable that blockchain has a vital role to play in the future of managing climate change. However, the UN initiative is actually not the only one. Several other blockchain climate change projects and groups are working to make this effort a reality.
THE BLOCKCHAIN CLIMATE INSTITUTE
The Blockchain Climate Institute is an international and non-profit volunteer-led entity. It acts as an advocacy group for blockchain climate change initiatives. The mission statement of the Institute is “to raise awareness among the international climate change policy community of the various potential of Blockchain technology to considerably enhance climate actions”.
It aims to achieve this mission in three areas;
- Aid developing countries access climate financing
- Increase transparency in climate funding
- Address climate finance flows, by helping to fill the funding gap between investment needed for climate change and the amount that countries have already committed to paying under the Paris agreement.
BLOCKCHAIN FOR CLIMATE FOUNDATION
The Blockchain for Climate Foundation has a single and succinct goal; put the Paris Agreement on the blockchain. It is a very ambitious project, which involves each country joining a single blockchain ledger and transparently recording their own investments and contributions to climate change. If this pulls through, it will be an all-encompassing near global blockchain climate change record. It is also obvious that such a global ledger would be a powerful tool in measuring and managing the impact of climate-related initiatives. However, it would also represent an outstanding and impressive demonstration of the potential for blockchain technology used internationally for the good of all.
The Blockchain for Climate Foundation is based in Canada. As a result, it is starting with putting the Canadian National Carbon Account on the blockchain. This will ultimately work as a proof of concept, demonstrating to other countries the possibilities with blockchain climate change tools. The Foundation is also convening a working group of government representatives to aid develop and guide the tool.
CLIMATE LEDGER INITIATIVES
The Climate Ledger Initiative is another group focused on the research and development of blockchain climate change solutions. It’s stated mission is “to accelerate climate action in line with the Paris Climate Agreement and the Sustainable Development Goals (SDGs) through blockchain based innovation applicable to climate change mitigation, finance, and adaptation”. CleanTech21 is a sustainable development foundation based in Zurich, and it’s behind the Initiative. The Governments of Switzerland and Liechtenstein both provide funds to the Climate Ledger Initiative.
In December 2018, the Initiative published a comprehensive paper showing various ways in which blockchain climate change initiatives could aid further the cause. These included using blockchain in taxation and carbon pricing as well as token-based crowdfunding for climate change initiatives. Another good example is the blockchain in renewable energy development.
Blockchain climate change initiatives are still very much in their infancy. The fact that there are numerous research-based groups and think tanks is a great show of this. It is still early and many of them are working separately but towards the same goals.