The recent development trend of blockchain: carbon offset process tracking

In less than 30 years or even less, how can people move from the current NFT boom to a world with net zero carbon emissions?

As the saying goes, the application of technology will definitely change the status quo. Although the blockchain has attracted widespread public attention due to projects such as cryptocurrency, tokens, and mining, it is obviously a blind admiration. Although some crypto enthusiasts have made achievements in decentralized electronic money, the real value of blockchain in the near future lies in linking the technology with mitigating climate change.

In less than 30 years or even less, how can people move from the current NFT boom to a world with net zero carbon emissions? This may start with the Biden administration. In order to achieve the arduous goal of drastically reducing greenhouse gases and achieving net zero emissions in the entire economic system by 2050 at the latest, companies and enterprises around the world are falling into a chaotic response to the coming crisis. Many large companies, including some well-known technology companies, are publicizing the progress of their carbon emission reduction plans, but there are still a lot of problems and difficulties to be resolved. One of the main problems is the unreliability or inaccuracy of the data. Another serious obstacle comes from the environmental, social and governance (ESG) disclosure requirements of the US Securities and Exchange Commission (SEC). This requirement is expected to be introduced this fall, and has already had an impact.

ESG issues have re-inspired people’s willingness to participate in the carbon offset program, and carbon offset has also become the cornerstone of the sustainable development goals. The recent application of blockchain can provide accuracy (a feature that was badly needed but lacked before) for carbon offset practices and help further the realization of the net zero emission plan.

Carbon offset related issues

Many companies have achieved a balance by investing in clean and renewable energy such as wind energy, solar energy, and hydroelectric power generation or purchasing carbon credits to compensate and offset the same amount of carbon emissions. There are two types of carbon offsets, voluntary and compliant. The value of the global carbon offset market is expected to reach between US$40 billion and US$120 billion, which is largely driven by the demand for carbon neutrality in society.

Given the indirect nature of carbon offset and the difficulty of measurement and verification, it is a relatively controversial practice. Take the “Wild West” that uses afforestation to offset carbon emissions as an example. Many industries that are difficult to reduce emissions are committed to this goal and “prove” the effectiveness of offsetting claims by deploying satellite and drone images. .

The overall lack of transparency in the unregulated carbon offset market has exacerbated some problems, such as the lack of auditable evidence to prove the authenticity of carbon offsets and that they are not sold in duplicate. This is where the blockchain can play a role.

carbon emission

To offset carbon, a company must first be able to capture its precise and specific emissions through actual measurement rather than estimation throughout its entire supply chain, manufacturing and delivery process. It is possible to understand the real-time sustainability impact to automatically calculate the total emissions and the daily carbon emission intensity of a specific operation, which can be achieved through technology.

The method is similar to transferring invoices from estimated and accrued expenses to automatic payment. When data is captured by industrial Internet of Things (IIoT) connected devices, real-time measurements and other information sources can be used to confirm the pre-agreed contract terms that have been met, and to trigger unmanned transactions based on actual numbers rather than guesses.

The same technology used to perform this operation is a smart contract protected by a distributed ledger, which can be configured to access and aggregate operational field data throughout the supply chain for direct measurement or emission calculations. This type of monitoring can verify the state of the environment in real time and provide reasonable propositions for promoting carbon offset programs. In addition, smart contracts can also create high-quality carbon offset actions by distinguishing the two key factors of source and uniqueness.

For companies that want to improve their carbon offsets in the process of achieving net zero emissions, they must first determine an accurate baseline of total emissions. The key is to obtain supply chain data to control carbon emission intensity and make changes.

Short-term feasible measures

As an auditable record system, blockchain can develop standardization and accountability, adopt a cost-effective and sustainable method to simplify operation procedures and track, measure and manage environmental impact data, which is also the value of company management The key to the chain.

Many companies are working on comprehensive changes to reduce carbon emissions. A feasible short-term initiative is to optimize carbon offset practices by providing transparency, integrity, and real-time understanding.

Original Author | Andrew Bruce (Forbes Committee Member, Founder and CEO of Data Gumbo)

Compilation | Aileen


Posted by:CoinYuppie,Reprinted with attribution to:
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