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Blockchain technology holds the promise to bring greater transparency to the carbon trading market.
China is synonymous with gray skies but pollution is not just a Chinese problem, it is something that is permeating the skies of the world and choking the major cities of the planet.
However, as the media focuses on China as the country makes rapid strides towards development, pollution and environmental issues often have to take a backseat.
Now IBM has come up with a Blockchain-based ‘green asset management platform’ that will help businesses in China reduce their emissions. The platform is based on the open source and openly governed Hyperledger Fabric.
The Paris Agreement on Climate has been ratified by 141 out of the 197 parties that have signed it. China is one of the signatories to the agreement.
IBM quoted the Director of China’s National Climate Change Strategy Research and International Cooperation Centre (NCSC) Li Junfeng as saying in a press release that China must assume its responsibility for global climate governance and continue to fulfill its pre-2020 climate change action targets. He further added that China has to build a standard nationwide carbon market.
In order to develop the green asset management platform, IBM has paired up with the China-based Energy-Blockchain Labs.
Cao Yin, Chief Strategy Officer of Energy-Blockchain says in the IBM press release:
“Blockchain technology is expected to become an important means for effective control of carbon emissions, which is of great significance to China, the world's largest source of carbon emissions.”
IBM and its Chinese partner have already finished a proof of concept in late 2016 and it is expected that the beta version of the green asset management platform will be released in May 2017.
Blockchain technology can help provide an element of cost-effective development of the carbon market.
According to IBM, it would be possible to utilize Blockchain technology to provide solutions to the various problems facing the carbon market. They are planning to utilize ‘digital collaboration’ and smart contracts to improve the efficiency of carbon assets development and management.
The immutable nature of Blockchains makes the carbon market more credible in the eyes of the stakeholders.
Cao Yin, Chief Strategy Office of Energy-Blockchain Labs, says:
“It is estimated that the platform will significantly shorten the carbon assets development cycle and reduce the cost of carbon assets development by 20 to 30 percent, enabling cost-effective development of a large number of carbon assets.”
If Blockchain technology can help protect the planet, then this would indeed be another leap forward for an emerging technology that has found multiple uses of late.
Chen Liming, Chairman, IBM Greater China Group is positive when he looks at Blockchain technology in the environmental context:
“The use of Blockchain technology in carbon emission reduction by IBM and Energy-Blockchain Labs is an important step forward.”
It would be interesting to see what impact carbon trading itself has on emissions worldwide but if there can be any measure by which the whole carbon market becomes more transparent and reliable and if Blockchain is the tech that makes it happen, it would certainly be great news for the planet.
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