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There's a lot of buzz about distributed ledger technology, commonly known as "blockchain", being the future of financial and legal transactions, but it also has the potential to tackle a much more complicated problem … climate change.
This is what Dr Philippa Ryan of the UTS Law discussed this week in a special session of the United Nations in Geneva.
More than 600 people representing 160 countries participated in the week of the International Organization for Standardization (ISO) of this year.
As part of this event, the UN has been invited to hear a series of presentations on how standards support innovation to address some of the United Nations' Sustainable Development Goals (SDGs).
Dr. Ryan presented the possible uses of blockchain technology in sustainability and climate action.
The session focused in particular on Objective 13 – Climate Action. One of the challenges is to help developing countries meet the growing demand for electricity without adopting high-emission solutions. Here's where the blockchain arrives.
Dr. Ryan states that industrialized and developed countries are heavily dependent on high-emission electricity production.
"For example, stopping the way in Australia to produce electricity to reduce emissions is difficult because the industries, infrastructures, systems and incumbent processes contribute significantly to the economy".
In contrast, in the developing world, the demand for electricity is increasing, but there is little or no existing infrastructure.
Dr. Ryan says this offers the opportunity to take a cleaner and more sustainable approach from the start.
"Using solar panels, communities and villages can generate, store and use their energy and the whole system can be safely managed using blockchain technology."
The idea is to think small: the micro-transtity networks involve a limited number of participants with each house or family that produces solar energy that is purchased and sold among the participants according to needs at different times.
In order for it to work effectively, there must be trust in the system.
"Without a central controller or system controller, everyone in the network community must be able to trust the registers that record the amount of energy generated, stored, purchased and sold within and across the network."
And this, says Dr. Ryan, is the beauty of the blockchain.
"Technology offers a transparent, verifiable and automated market trading and clearing mechanism to the benefit of producers and consumers".
It can also support communities where not everyone has a bank account. The settlement of debits and credits can take place at a time agreed according to accepted local traditions or commercial conventions.
Dr. Ryan's presentation was well received and raised questions from the public about the challenges and risks involved in implementing blockchain technology.
While complexity, cost and reputation have been the main obstacles to adoption, standards can help solve all three of these obstacles.
"At a time when global confidence in the government, banking, media and other powerful institutions has weakened, the blockchain can play a significant role in the democratization of new, more reliable commercial networks: these new economic models can be exemplary for how blockchain technology could help you achieve some of the SDGs. "
In addition to the UN session, Dr. Ryan also spoke at the ISO General Assembly with an update on the global work of the ISO Blockchain Technical Committee.
She is co-author of Blockchain: Transforming your company and our world, which explains how distributed ledger technology can help solve "evil problems". Dedicate an entire chapter to climate change.
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