Carbon Accounting

Introduction to "On Chain" Carbon Accounting 

Developing, verifying and coordinating a complete and transparent greenhouse gas (GHG) emissions inventory is key to understanding and managing national emissions, past trends, projecting future emissions, identifying sectors for cost-effective mitigation opportunities and harmonizing them with Paris targets.

One approach to the use of this technology is using NFTs and other tokenized forms of attestation to track emissions. This is similar to the use of blockchain technology for supply chain and logistics but at the macro scale.

As of 2024, as part of the reporting requirements of the Enhanced Transparency Framework (ETF) under the Paris Agreement, countries are required to report national GHG inventories and a national inventory is required in all reports to the United Nations Framework Convention on Climate Change (UNFCCC).

And yet, it seems there hasn’t really been enough thought given to how to coordinate governmental and non-governmental actors when it comes to effective GHG accounting. How are we connecting International pledges and targets with National emissions reductions that are either actualized or non-actualized accomplishments, let alone, with the emissions of nongovernmental actors?

The process, as it sits right now, is not working both from the point of view of accountability and also from the point of view of timeliness. While the clock on climate change is rapidly counting down to midnight, data gathering is being conducted in the 19th century. National governments submit their data of what they have been doing manually every 5 years on a pdf and then experts sit down with it for 3 years and then in 8 years they tell us how much we missed our targets by.

What is needed is an International data sharing layer of applications writing to and reading from the blockchain in order to store information in an immutable, transparent way that can plug into existing systems and act as a building block for other blockchain enabled applications. These systems have the potential to be accessed and added to at each level of government and also tie into industry reporting and verification applications. The goal would be for all of the players to be able to plug in their system and from that there will be a more accurate picture of emissions.

There is a tremendous amount of momentum around blockchain as a verification tool bothon a non-state and state level due to the inability of any other technologies to be consistently verifiable as well the urgent need to find a neutral ground to both eliminate bad actors and create an incontrovertible and irrefutable home for international agreements to be verified and held to account.

Blockchain technology can facilitate a totally transparent system for carbon accounting, which right now we don’t have at all.