UN supports blockchain use in climate change fight

The United Nations has announced support for the use of blockchain technology in strengthening climate action.

Environmentalists working in the field of climate change have recently recognized the transparency and efficiency offered by the technology, which was first used for facilitating Bitcoin digital currency transactions in 2009.

The new UN-backed Climate Chain Coalition will now investigate its use in such areas as tracking clean energy trading and carbon emissions..

“The UN Climate Change secretariat recognizes the potential of blockchain technology to contribute to enhanced climate action and sustainability,” said Massamba Thioye, manager of sustainable development of the United Nations Framework Convention on Climate Change (UNFCCC), in a release on Tuesday.

How blockchain for climate change started and why China is the focus area

During the climate change conference in Bonn in November last year, a group of 25 organizations working on blockchain held a meeting to collaborate and establish an open global initiative called the Climate Chain Coalition.

The organizations proceeded to prepare a draft at the One Planet Summit in December at Paris to further the use of blockchain in four key areas: carbon emissions trading, clean energy trading, climate finance, and tracking and reporting of greenhouse gas (GHG) emissions reduction and avoidance of double counting.

Peter Smith, chief executive officer of Blockchain Ltd, speaks during the Lisbon Web Summit in Lisbon on Tuesday, Nov. 8, 2016. /VCG Photo‍

The experts, primarily from the climate finance sector during the side events at the conference, maintained that blockchain could improve governance and sustainability in support of collective action aimed at tackling climate change.

“As opposed to centralized or decentralized networks, blockchain prevents monopolistic control over the system. The technology also records transactions openly and permanently, thus fostering transparency and traceability,” experts maintained in the draft.

They also presented the example of the IBM and Energy Blockchain Lab joint initiative to develop a blockchain platform for trading carbon assets in China.

Climate leaders at Bonn were expecting China to announce the launch of a carbon trading scheme (CTS) at the conference. Beijing eventually announced its CTS last December and became the world largest carbon scheme.

Cao Yin, chief strategy officer of Energy-Blockchain Labs before China’s CTS launch, said, “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."

China launched its Carbon Trading Scheme in December last year to control emissions. /Xinhua Photo

How will blockchain for climate action work?

A blockchain is a distributed database that is continuously updated and verified by its users. Each added block of data is “chained” and becomes part of a growing list of records, under the surveillance of network members.

This technology enables the transfer of assets and the recording of transactions through a secure database.

“As countries, regions, cities, and businesses work to rapidly implement the Paris Climate Change Agreement, they need to make use of all innovative and cutting-edge technologies available,” said Alexandre Gellert Paris, associate program officer at the UNFCCC

“Blockchain could contribute to greater stakeholder involvement, transparency, and engagement and help bring trust and further innovative solutions in the fight against climate change, leading to enhanced climate actions,” he added.

At present, about 32 members have signed up to the coalition. The UNFCC has invited participation of more organizations to give a boost to blockchain for climate change.