The mission of this working group is to
  • identify how blockchain or distributed ledger technologies (DLT's) could improve corporate or personal carbon accounting
  • make carbon accounting and certifications more open, transparent, and credible
  • build collaboration between consumers, businesses, and investors across industries and national boundaries.

We're here to help 

  • Businesses and organizations take action on climate change by making the process easier and less costly.
  • Certifying entities scale by streamlining the verification of corporate climate action.  
  • General public and consumers trust corporate climate action.
  • Lenders and investors align their capital decisions with climate goals.

We're Live!

The Emissions Data Channel and Emissions Tokens Network are now deployed in production:

To sign up for a beta please email the Climate SIG mailing list.

Good First Issues

We're using Github to host the code for this lab.  Check out the blockchain-carbon-accounting repo and take one of the good first issues that are posted there.

Scope

The current scope of this working group includes:

  • Identifying standards for corporate climate accounting and certifications.
  • Implementing open source DLT software to demonstrate climate accounting and certifications.
  • Providing recommendations on how DLT's could complement or improve current industry processes.
  • Promoting awareness and positive action in the larger Hyperledger and DLT community.
  • Educating other stakeholders on the value of DLT's and Hyperledger in climate change.

Active Members

To help group members meet and interact with each other, people are welcome to add their contact information and your time zone to this page so that other participants can contact you directly. 

Adding your name here is optional and is not required to be a part of the group. 

To add your name in the directory below: you will need edit access to the wiki, and for this you need to get a free Linux Foundation ID. Once you have your LF ID (which you can use to log in the chat as well) you can log in and edit the table below with your information. After adding your name here, please also subscribe to the group's mailing list and post an introduction there so other group members can get to know you. You can also join the CA2 Hyperledger Chat group and make a personal introduction there and join the regular group meetings. 

NameCompanyTime Zone
Si ChenOpen Source Strategies, Inc.US Pacific

Christiaan Pauw

Nova Institute



Robin Klemens

Blockchain Lab - Institute for Internet Security

CET
Lam Nguyen

Connectivity AAU



Kamlesh NagwareSnapper Future Tech

vaneet sharma

peregrines computing s.l



Carlos Germano Ferreira Costa&Cho - Green Fintech

Brazil


Vatsal M

Solligence Digital Solutions LLP

India


Umesh GhodkeWestern Climate Initiative, Inc. US Pacific
Kris SternNCSIHong Kong
Sherwood MooreICANNPST
Lucy LowFarmerNet.OrgSan Francisco
Chris AdamsCiscoLondon GMT
Jeff Pribichblockchainindustrygroup,orgChicago 

Background

As the world gets serious about climate change, the discussion is increasingly shifting from "Should" to "How":

  • How do consumers know that a "green product" is really better for the climate?
  • How do investors know that portfolio companies are achieving their climate goals?
  • How do offset buyers know that the offsets work?
  • How do lenders know that green bonds and transition bonds are driving positive climate action? 

The only way we could do this is with a climate accounting system, similar to the financial accounting system that drives all economies.  Yet today, such an accounting system does not really exist.  This is because of the challenges of data and trust.  

The Challenge of Data

A GHG emissions audit requires data from a lot of different sources, many outside of the company.  The Greenhouse Gas Protocol specifies three levels of emissions: Scope 1, 2, and 3, covering direct energy use (fuel burned on site), indirect energy use (energy purchased from utilities), and all other significant activities of the business, including products purchased, transportation of goods, travel and commuting of employees, and leased assets.

The problem is that most emissions come from activities which are hard to get data for.  At a minimum, the data would need to come from every part of the business, from purchasing to manufacturing to facilities management to human resources.  More importantly, it also involves data from a company's supply chain partners, such as the manufacturers of its products or components.  Those manufacturers, in turn, may not have this data or may not wish to publish it for competitive reasons.  Finally, what data could be obtained must often be gathered manually and entered into spreadsheets.   

The high cost or complexity of obtaining the data has limited both the quantity and quality of data used for emissions calculations.  Often, emissions are calculated based on national and industry level economic activity–for example, the plastics industry in the United States as a whole.  If that's case, how do we know what the emissions of a particular plastic packaging manufacturer are?  What incentive does a particular manufacturer have to reduce its emissions?

The Questions of Trust

At the same time, it's not hard to see why the general public could be skeptical of a company's climate action claims.  After all, as consumers,

  • Can we trust the data that the company has provided? 
  • Can we trust judgement calls, made by either the company or a certifying entity, about which activities are not relevant and thus do not require data and auditing?
  • How do we know if the company is in fact working on its emissions reduction plan?
  • Can consumers and investors trust that the certifying entity is objective?

Meanwhile, institutional investors such as the Net Zero Asset Owner Alliance or Climate Action 100+ have a different trust issue.  They are used to more in-depth analysis and independent verification of companies' claims, and carbon neutral certifications do not have the same level of detail as other financial ratings they are accustomed to.  For example, when investing in bonds, it's not enough that one rating agency, such as Standard & Poors or Moody's, considers a bond "investment grade."  They typically require credit ratings by more than one rating agency, and the ratings are in tiers from AAA (highest credit quality) to CCC (high default risk.)   As climate neutrality becomes important to them, they would probably demand the same level of detail in ratings of corporate climate action.

Why Blockchain (DLT's)

Fortunately, blockchains or distributed ledger technologies (DLT's) are by design made for solving these issues.  With blockchains, we can

  • Automate data collection from a large number of sources, as is typical in supply chains.
  • Maintain audit trail of immutable records, so that emissions calculations could be verified later without relying on one central repository.
  • Create trust in CO2 emissions accounts as they are transacted across industry and national boundaries, where no trusted central repository exists.
  • Allow consumers to participate in climate action plans of the companies they buy from and invest in. 

DLT's differ from Software as a Service (SAAS) in a fundamental way: They are designed for collaboration across a large number of potential users/participants without signing on to a central service provider.  They are thus ideal for crossing traditional industry or national boundaries or for allowing small entities (SME's) or even individuals to interact with large ones (multinationals and government agencies.) 

Why Open Source

By making the source code available, we make the carbon emissions accounting and certification process transparent, so that all stakeholders could see what went into it.  This increases the trust in the results.

Furthermore, by creating free tools for gathering data, we allow certifying entities to focus on analysis, while reducing the cost of carbon emissions reporting so that it becomes possible for companies of all sizes, instead of just the large, public ones.  

Getting Started

Our goal is to create software that could be used to deploy climate action at a variety of scales, from supra-national cap and trade to community renewable energy projects.  Take a look at what we're building -- an Operating System for Climate Action.  

Get Involved

This is an open source project and anyone is welcome to get involved and we will be happy to see you contribute.

1) Start by subscribing to the Climate SIG mailing list for updates and meeting notifications.

2) Join our bi-monthly Peer Programming Zoom call for developers on Mondays at 9 AM US Pacific time (UTC-07:00 America/Los Angeles.) Please check the calendar for the next call. 

3) Check out the good first issues from our blockchain-carbon-accounting in Hyperledger-labs and feel free to contribute a fix for one that looks interesting to you.

4) See our How to Contribute page for other ways how you could get involved. 


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73 Comments

  1. Christiaan Pauw

    Added "or personal" to mission statement. Personal carbon neutrality is very important because a public who is personally commited to climate neutrality will drive corporations to do the same (even if only for selfish reasons). 

    1. Si Chen

      That's a good idea.  I think the same concepts about the DLT could apply to personal carbon accounting.  We should do some research on what standards, if any, exist in that area and think about how to adapt the same framework or code for it.

  2. vaneet

    This looks great.   If you guys need some help, happy to give a hand.

    1. David Boswell

      vaneet – I'm glad to here that this sounds interesting and it would be great to get your help.  If you can make it to the next Climate Action and Accouting SIG call that is happening tomorrow, Tuesday, July 28 at 8 AM pacific you can talk more with others about next steps.  The dial-in for that call is:

      https://zoom.us/my/hyperledger.community

      And please also feel free to join the group's mailing list and take part in discussions there:

      https://lists.hyperledger.org/g/climate-sig

      1. Peter Clarke

        David Boswell I am finishing a submission on Call For Code but will multi-task as best as possible.  

        After July 31 at 23 59, I will be available. Peter

      2. vaneet

        David Boswell  Thank you David. I couldn't attend call on tuesday as i had other meeting here in Barcelona. 

        I am happy to join mailing lists.

        I can help in defining architecture, development and other areas if required.

        Regards

        Vaneet

        1. Si Chen

          That'd be great!  Could you give me some feedback on the ideas for an architecture here: Multi Channel Data Architecture

          And here are some examples of apps we can develop based on this idea: Operating System for Climate Action

          Thanks!

  3. Peter Clarke

    Hello everyone, 


    My name is Peter Clarke and I wanted to introduce myself. 


    I have experience in setting up emission trading along with Fabric. I heard of your vision and am honoured to be of service. 


    Look forward to speaking to you on the zoom. 


    Warm regards,


    Peter

    1. David Boswell

      Peter Clarke – Glad to hear you're interested in what the group is doing and want to get involved.  And I think people would be interested to hear more about your experience setting up emission trading with Fabric.  Would you be open to sharing more about that with the group on the mailing list at: https://lists.hyperledger.org/g/climate-sig

      1. Si Chen

        Yes we'd all like to hear what you've done!  

  4. Peter Clarke

    Hello David and Si.  Great to connect with you. David Boswell Si Chen

    I should have said  - I have experience in setting up regulated Emission Trading Markets and

                                       also, have Fabric experience  

    'along with'!


    1. How I may be of service:   

           Setting up European Union Emissions Trading Scheme or EU-ETS in 2005:  A multi-stakeholder committee was established which included the International Swaps and Derivatives Association or ISDA. I was a member of that committee and our job was to standardize ISDA multi-party netting agreements and their credit annexes for Carbon Trading (more specifically EUA or Emission Reduction Allowances). The ISDA committee standardized contracts to facilitate over the counter trading in options and other products needed by liquidity providers such as hedge funds

         2. I represented brokers of EUA allowances such as GFI, Tullett Prebon, ICAP PLC . These firms have since amalgamated but were key stakeholders in the launch of emission products.


        3. EFET is the European Federation of Energy Traders and IETA is the trade body for emission trading.  My role was to get them to accept a standardized contract, at least in the case of EFET to prepare for the listing of OTC contract on exchange


      4. The decision was to recommend what is now ICE or the intercontinental exchange. This resulted in the launch of the first vanilla contract on ICE. Other exchanges adopted this format. 


      5. Forestry - this is my dream. I would love to see forestry conservation given a seat at the table at COP26.  My experience in REDD and additionality gives rise to the hope that the destiny of Voluntary Credits not be limited to cause related marketing. I have respect for those seeking to raise awareness of deforestation. If I could play a role in making their job easier by adding economic benefits for conversation, it would be an honour. 

    I have served on a forestry board that provided submissions to UNFCCC and understand the challenges.


    Blockchain 

       Certainly have no problems rolling up my sleeves on this subject.  I invested in the development of Hyperledger Fabric in its beta phase after reading a JP Morgan report on Juno in March 23 of 2016

       Our vision was to connect developing and developed markets using the transparency of blockchain to facilitate foreign direct investment. 

       Our proof of concept was between London and Mogadishu, Somalia. We set up a virtual central bank with a read only audit node. This was on bluemix.  

       That was May 8, 2016.  We chose Somalia because it has the worst reputation for transparency.  "If I can do it there, I can do it anywhere" is Sinatra but that was the concept.

       Thereafter, we trailblazed by pure bootstrapping. Stuff like Crypto and ICOs we let go by, so our knowledge of Ethereum is negligible. I think after 14 blockchain use cases we know the basics.


    Next Steps:

    I need to read up on what accomplishments you have achieved. I am late to the party and wish to be a value added in perhaps areas like linking-mechanisms or immobilization - or what you think you need.  


    Kind regards   Peter

        


    1. Robin Klemens

      Hi Peter, thank you very much for sharing what you've accomplished so far. I'm amazed and more than happy to have you on board. Looking forward to the next climate sig call to get in touch.
      /Robin

    2. David Boswell

      Peter Clarke  – Sounds like you have some really relevant experience in both the emissions and blockchain work you've done.  I'm looking forward to collaborating with you in the group and on future calls.

      I'm also adding the CA2 SIG chairs to this comment thread – Martin Wainstein  and Tom Baumann – so that they're aware of your interest and so that they can offer their thoughts.  For instance, there is also a Standards Working Group happening as part of the CA2 SIG and that may be of interest to you as well or perhaps there is a new Forestry related Working Group we could get going in the group to help you with your goals around accounting for the economic benefits of conservation?

  5. Si Chen

    Hello Peter ClarkeNice to meet you.  Sounds really interesting.  Please take a look at what we have so far and give us your comments/suggestions.  I'm trying to generalize the architecture and come up with a variety of use cases, and I put all the links here:   Operating System for Climate Action

    I'd be very interested in thinking about your use cases for forestry and offset credits in this context.  

    1. Peter Clarke

      Si Chen David Boswell Robin Klemens Martin Wainstein Tom Baumann


      Well, amazing.  


      What I understand you want to do is to create a single standard for Carbon accounting.


      • This would be analogous to the basket of currencies managed by the IMF called Special Drawing Rights. Call it a Global Sustainable Unit. 
      • The GSU thus being a fungible instrument across all markets from AB32, RGGI, EU-ETS means a global exchange network.  Hyperledger with the FIX messaging protocol is a good way to connect the buy-side. 
      • How I can help is to connect the various stakeholders, assuming most are not already represented.  
      • First step is to pick a country as the node for a GSU.  Indonesia comes to mind, as they are contemplating a carbon market in the autumn. The analysis will be straight forward - The national utility is a coal hegemon but ignores off -grid solar.  The Levelized Cost of Electricity from Utility Scale will be less that thermal coal, which Indonesia exports. They would like to be a centre for Sukuk bonds, or Shari's compliant green bonds , which are blockchain friendly. 
      • Link them up with other exchanges through the Sustainable Stock Exchange initiative, add liquidity through global finance funds and act as a virtual global registrar. 

      Where I can help is from what I did before. This was to standardise contracts for OTC trading and then develop an on exchange physical GSU and vanilla options. You are aiming for a global registry not an EU one but you have more time until COP26. The goal from the work you have done is to expand the stakeholder base. 

      Sound right, or am I too off-piste? 

      Before anything, what is being entered in Call for Code as with this tragic pandemic nodes in places like Ecuador Uganda Indonesia etc.  need to instantiate their chain code. 

      Peter


      1. Si Chen

        Thanks for your feedback, Peter Clarke .

        It does not necessarily have to be a single standard, though that'd be nice!

        Rather what I see is different channels and different smart contracts (chaincode) that calculate emissions based on data and models.  For example, if we could access monthly utility bills in energy units (kWH), we can multiply that by the emissions factor for the utility to get the emissions.  If the utility is able to provide better data, such as time of use or real time generation mix (renewables vs natural gas), then that's better data we could use.  In either case, we could then calculate the emissions of a product based on the utility data and then publish it for the customers who buy the product.

        This could be pretty flexibly adapted to use cases big and small.  I'd like to find out more about your use case and see how we could adapt to it.

        I looked at the Call for Code, but we don't have a product that's ready for it yet.  Definitely next year.

      2. Peter Clarke

        Thank you everyone for being so welcoming.


        Forestry - Stichting FACE (Forests Absorbing Carbon Dioxide) is a Dutch foundation that managed sustainably managed forests in Malaysia, Ecuador and Uganda. 

        I was on their advisory board. We submitted REDD frameworks to the UNFCCC  .  My view is that conservation can and should be economically encouraged and the US southern states are 

        the best examples of best practices. I look at these issues in black and white - Palm Oil is more profitable as an export than preserving tropical ecosystems. Southern forests absorb much more CO2 than the lungs of Brazil and the main reason the UK meets its emission targets is thanks to biomass from Georgia and her neighbours.  

        I like the transparency of blockchain and the 'alpha' it affords ESG types like me. 

  6. Peter Clarke

    Our use case is using avatars to educate people at scale on respirators, etc in multiple languages.  It is relevant to climate change because spiking neural networks are resource intensive. The DOE /IBM/NVIDIA et al have 300 petaflops of GPUs. There is no going back and the very data sets you need or studying the climate requires lots of data.



    I've got some chain code and data sets and can instantiate it on a couple of nodes. I'd like to try out a Sukuk bond. 



    1. Si Chen

      Great.  Let us know if you'd like to get this set up and running together or collaborate in some way.

      1. Peter Clarke

        Ready.



      2. Peter Clarke

        We set up a blockchain and can submit a climate change use case in the same github repository with attribution to the CA SIG team. 

        Straightforward transfer of a synthetic Global Resource Unit to link various countries with sacred habitats.

        Indonesia - Ecuador - London - with auditor function in CA. 

        An innovation of why this is different from bluemix (2016) will be addressed in the time remaining. 


        Anyone who can instantiate Node.JS , please let me know.  Kind regards, Peter

        1. David Boswell

          Peter Clarke – If you're looking for help with Node.JS or anything else, I recommend posting about this on the CA2 SIG mailing list.  There are over 120 people on that list so that means many more people will see the conversation and the note about how to help out than they will on this wiki page which is being tracked by a smaller number of people.  The mailing list is at:

          https://lists.hyperledger.org/g/climate-sig

  7. Lam Nguyen

    Great! My name is Lam, from Connectivity Group, Aalborg University Denmark. We are doing research on Accounting CO2 emission, Emission Trading.  Glad to join working group. 

    One of our research on using Hyperledger Fabric to address Air Pollution https://arxiv.org/abs/2004.06299. The benefits of the integration of DLTs into air pollution monitoring include guarantee of immutability and transparency for environmental sensing data; removal of the need for third parties; and development of a transparent system for heterogeneous IoT monitoring networks to prevent tampering and injection of fake data from the stakeholders.

    1. Si Chen

      Hello Lam NguyenInteresting paper.  Thanks for sharing it.  You might want to share it with the general Fabric list as well – I think your conclusion that "by adequately choosing the DLT and its parameters, the impact of DLT traffic on the battery lifetime of NB-IoT nodes may be relatively low" would be of interest to other groups as well.

      Also I had a question: "the uplink data generated by the UEs is transmitted to a randomly chosen group of endorsing peers of Hyperledger Fabric as transaction proposals" – Does that mean you were communicating directly with the Hyperledger Fabric peers?  How did you know which peers were running at any time?  Did you go through a message queue to hold the data from the UEs at least temporarily while you located a peer?

      1. Robin Klemens

        Lam Nguyen thanks for sharing your paper with the community (smile)

        I'm also interested in Si Chen question of how the IoT devices choose randomly to which peers the connect to. As far as I know, Hyperledger Fabric provides two ways to connect to the network. This is either possible by a static connection profile that contains all the data about the network (channel, peers, orderers, etc.) or by a dynamic connection profile. With the dynamic gateway, the client gets the needed information about the network due to service discovery. In this case, the connection information of one peer is enough (not recommended to rely on just one peer). However, I don't not how to randomly choose to which peers to connect to from the client-side. But I'm very interested in your solutions as I see great benefits in it.

        1. David Boswell

          Robin Klemens Si Chen Lam Nguyen

          For questions about IoT and DLTs, I wanted to let you know that the Telecom SIG is currently working on a paper related to IoT and they have an IoT working group.  That may be some people to reach out to about what you're doing and seeing if they can answer any of your questions or if they want to collaborate.

          Their draft paper is at:

          The Telecom mailing list is at: https://lists.hyperledger.org/g/telecom-sig

          Feel free to send the list a note about what you're doing and any questions you have.

    2. Si Chen

      Bill Lam Could you please also take a look at the Transportation Emissions – I just started on it, but Anshu Jainhas worked with a group that has built a mobile app to track car travel.  I thought it'd be pretty cool to then put trip data on a ledger and calculate their emissions based on vehicle type, then link them to carbon offsets, maybe through a pooled purchase scheme.  I think we'll have a lot of fun with that one.

      1. Anshu Jain

        Hi Si Chen  Bill Lam

        You can find more videos/information on the "mobility" related work of Shankari , Elefthorios and team on the project reckoner.    Any further thoughts welcome.

        1. Si Chen

          Thanks Anshu JainI'll take a look!

  8. Peter Clarke





    Si Chen Lam Nguyen Robin Klemens David Boswell Martin Wainstein


    Robin:    We provisioned an IBM Blockchain as we may want to join their network at some point.  

                   We also have several networks configured according to your instructions. These are Hyperledger 2+ in several geographies.

                   I believe you are in Germany, so we should discuss a linkage. We have all the standard 'chain code' packages - Asset Transfer, Commercial Paper 

                   What github repository should we fork or commit?  


    Lam Nguyen  Climatic and Air Pollution Data Sets are unstructured and streaming and need to be 'normalized' ' in real time. You would

    use the Iguazio engine or AWS Lambda not Hyperledger for normalization. Look at Hacera.com as more of an option for data integrity than Fabric. 












    1. Robin Klemens

      Hi Peter Clarke,

      at the moment there isn't any repo you could fork. We gonna start coding on Tuesday next week and the question at which GitHub repo we gonna work together is still unanswered. In the last CA2 SIG call, we talked about hyperledger-labs. David Boswell could you help us the get a repo there and tell us about what is needed for application, please?
      Otherwise, we can simply use one of our personal GitHub repos or create a new one.

      As soon as we coded chaincode to the deploy we could consider IBM Blockchain platform as a second testing environment beside a locally run docker-compose network.

      1. Peter Clarke

        Morning Robin,

        Sure!  I cannot access some of this group's resources for some reason. So, my email is peterclarke@alumni.lse.ac.uk and whatsapp 44 778 853 3609 as back up.

        We probably should use a tool chain (IBM's term for dev ops, if you haven't use IBMCloud much) 

        Some questions if OK:  What version of Fabric are you using?

                                                                  Chaincode in Node.JS ? 

                                                                  https://github.com/hyperledger/fabric-samples

           Kind regards, Peter                                  

      2. David Boswell

        Robin Klemens  – Hyperledger Labs provides space for community members to host coding projects like this and it would be great for the CA2 SIG to start a Labs project so that we can collaborate with the rest of the community on this.  There are steps for creating a new Labs project at:

        https://hyperledger-labs.github.io/

        I sent Si the information too, so please feel free to sync with him and then let me know if I can help with the Labs creation process.

        1. Si Chen

          Robin Klemens David Boswell I'm going to look for a sponsor and submit a proposal to Hyperledger fabric.  If we're not set up we can use a temporary one at https://github.com/opentaps/ 

          Speaking of Peter's question, what do you think of node.js?  We're more familiar with it here as well, and there's more support for it on other projects, like OrbitDB (see https://blog.logrocket.com/guide-to-orbitdb-node-js/)

          1. Robin Klemens

            Si Chen  Peter Clarke

            I’m fine with node.js. More precisely I suggest coding the chaincode in TypeScript instead of JavaScript. First, TypeScript is object-oriented which makes the code more clean, deterministic, and consistent. Second, TypeScript does static type-checking at compile time. Thus, we don’t need to wait until the chaincode is executed for the first time which requires many steps in HL Fabric. What do you think?

            1. Si Chen

              Robin Klemens I like the Typescript idea.  I was going to start with some of the Javascript examples.  Should we convert them to Typescript first, then build TS to javascript to deploy as chaincode?

              Meanwhile take a look at https://github.com/opentaps/blockchain-carbon-accounting - I've got the network and channel set up with minifabric.

      3. Peter Clarke

        Robin Klemens David Boswell


        Robin,

        Thank you for your clear and precise response. 

        David

        I believe only a member of the Climate Action Technical Steering Committee or WG can be owner of a hyperledger labs repo.

        See section 4(a) of the Hyperledger Charter. 



        1.  CA2SIGtestchainGRU   https://github.com/CA2SIGtestchainGRU/Sandbox         is a public repository
        2. https://github.com/CA2SIGtestchainGRU/CentralRepo                                          is a private repository
        •  This framework complies with section 4(a)
        • Right now, these are just two repositories waiting to be populated
        • I removed myself as owner on both repositories after adding Robin and you as owners. I then issued invitations to your respective email addresses. I am now a member.

        I am mindful of the time difference between Europe and the United States. So,

              3.  My team will use the Sandbox repository or a fork thereof.

              4,  Robin also has a repository he can use

           All you have to do when you see this message is remove me from Central Repo. 


        Peter

        1. Robin Klemens

          Si Chen  Peter Clarke  it seems to me that you both try to do the same. Let’s agree on one repo we gonna submit to hyperledger-labs. Thanks to both of you for pushing this!!!

  9. vaneet

    Hi guys, Robin Klemens Si Chen

    have we finally defined the architecture ?

    if you guys want, i can help in creating user stories and feature list aka scrum or kanban (smile)

    and can also code some parts.

    For now, i am not convinced with some of the design decision but perhaps i am missing some of the know how.

    Si Chen , how can i attend the calls ?

    Regards

    Vaneet


    1. Si Chen

      vaneet I'm OK with this architecture for now but of course it's still work in progress.  It'd be great to have some some better defined user stories, etc. if you don't mind revising them – the joy of developing code, right? (smile)  I'd suggest you put in Emissions Data Channel since that's a real use case we're implementing.

      The call is 

      Tuesday, 18 August 2020
      9:00am to 10:00am
      (UTC-07:00) America/Los Angeles

      Where:
      https://zoom.us/my/hyperledger.community

      Look forward to seeing you!

  10. Peter Clarke

    Design Choice:  Tokenization and Dematerialization 

    • I am posting design choices in this channel to ensure consistency between Utility Emissions Channel and Multi-Channel Architecture.
    • The design choices we need to consider soon are Tokenization and Integration. 
    • Tokenization  is the process of dematerialization within the context of a blockchain network. I prefer to describe tokenization as the same process as the issuance of securities and dematerialization as the metamorphosis of 1 ordinary share certificate of IBM into its digital doppelganger (twin).  
    • Specifically, a 'saving' through good behaviour of 1 CO2e means an authority needs to issue an EUA certificate onto a ledger. Tokenization is simply the creation of an electronic or digital certificate akin to an Excel spreadsheet. No paper certificates are involved, thus we need to think about how creating and transferring tokens would work in the Emissions Network. 


    • Hyperledger Fabric does not use native coin architecture - The system code which is used to operate a Fabric network and the Chain Code, or application code, developed by users does not rely upon or have anything to do with 'Coins.'  
    • Hyperledger Fabric (subject to the version) is agnostic on the subject of consensus algorithms. The network is a series of nodes,, defined by Membership Services Provider (MSPs). which are further grouped and sub grouped by organization and peer. I find it useful to think of a node as Lehman Brothers that sets its own rules for transactions which will be different to JP Morgan node. 

    Example

    Robin lives in Europe and so he is in a nearby time zone.  We decide to JOIN our e-mission networks through the creation of a channel. Robin has designed his blockchain using  the RAFT consensus algorithm. I, on the other hand, have chosen Kafka and Zookeeper. He prefers to code (chain code) in JavaScript whereas I prefer Golang.

    We then call up David in California because we want to test latency.  We discover that David has coded his chain entirely in JavaScript and decided to experiment with consensus algorithms known as Solo and Eve. 

    Question:

    Three separate 'organizations' (Peter Robin and David) have designed blockchain networks that use different application languages and consensus algorithms. The blockchain is Fabric, so by definition does not use native coin design. There is no 'gas' or 'ether'' or mining. 

    Do we have a problem?  

    No. We have plenty of time to (1) decide upon an endorsement policy and (2) determine a way of generating a 'token'


    Analysis for Members

    • Fabric was first donated to Hyperledger Foundation by IBM and Digital Asset Holdings in early 2016. It has gone through several iterations since v0.6. However, I think I am basically correct in assuming its architecture hasn't changed much since 1.1
    • A Fabric blockchain consists of a set of nodes that form a network . As Fabric is permissioned, all nodes that participate in the network have an identity, as provided by a modular membership service provider (MSP)  
    • Fabric has two types of code. The code that runs the network, or VPCC, and the code that users bring to the table. The latter is the application code or chaincode. The VPCC operates completely independently of chaincode. The detail gets dense, but it is because of the order-execute-validate design of HLF.   The ordering service or ONS establishes the total order of all transactions in Fabric, where each transaction contains state updates and dependencies computed during the execution phase, along with cryptographic signatures of the endorsing peers. Orderers are apart from the application state, and do not participate in the execution nor in the validation of transactions.
    • The high level design is Clients submit transaction proposals for execution and broadcast transactions for ordering. Peers execute transaction proposals and validate transactions. All peers maintain the blockchain ledger, an append-only data structure recording all transactions in the form of a hash chain, as well as the state, a succinct representation of the latest ledger state. Not all peers execute all transaction

    IBM Research (Notes from 2017)

    Discussion on design choices. As the endorsers simulate the proposal without synchronizing with other endorsers, two endorsers may execute it on different states of the ledger and produce different outputs. For the standard endorsement policy which requires multiple endorsers to produce the same result, this implies that under high contention of operations accessing the same keys, a client may not be able to satisfy the endorsement policy. This is


    Discussion on design choices. It is very important that the ordering service does not maintain any state of the blockchain, and neither validates nor executes transactions. This architecture is a crucial, defining feature of Fabric, and makes Fabric the first blockchain system to totally separate consensus from execution and validation. This makes consensus as modular as possible, and enables an ecosystem of consensus protocols implementing the ordering service. The hash chain integrity property and the chaining of blocks exist only to make the integrity verification of the block sequence by the peers more efficient. Finally, note that we do not require the ordering service to prevent transaction duplication. This simplifies its implementation and is not a concern since duplicated transactions are filtered in the read-write check by the peers during validation.


    Suggestions


    The value proposition of blockchain is largely in part because multiple parties can transact across borders. Thus, Tokenization and Integration are issues which need to be addressed. 


    • Tokenization can be accomplished by using a UXTO model. Essentially, one organization is designated as the trusted keeper of Key Value States. Tokens are 'minted' or destroyed by and among network participants and the nominated organization acts as a qualified custodian. 
    • The endorsement policy is what needs to be agreed upon. See Below.
    • Dematerialization - Minting or Destroying tokens is problematic in jurisdictions which allow for 'paper' certificates. Many US states, South Africa, the UK in some  markets and others allow for stocks and bonds to be in paper form. Hence the term 'clipping coupons'. It is only an issue for a production system, but clearly once something gets issued and traded it immediately because subject to regulation




    Other points


    • 90% of transactions are off chain. One of the hardest calculations in the capital markets is the calculation of the decay in electricity prices.  This cannot be made into a smart contract. The most common algorithm I know is pricing an American Option, which will bring down the network.( I will not mention who tried to code the relevant pricing algorithm )
    • Wallets - Tokens need to be stored somewhere.  Not a major issue with Fabric - but it is an opinion.

        


    Peter

    1. Si Chen

      Thanks for your thoughts.  Calculating emissions is just the first step.  What you're saying would apply to renewable energy certificates or carbon offsets and other things as well.

      Are you saying we should issue the tokens on Hyperledger fabric or some other ledger/protocol?

      1. Conor Svensson

        If there's a need for tokenisation here I can offer guidance from a Hyperledger Besu/Ethereum angle. We wrote the OSS integration libraries used by these platforms for the JVM/Android - its trivial for us to create OpenAPI compliant endpoints for smart contracts on these platforms significantly simplifying the integration piece too.

        1. Si Chen

          Conor Svensson That would be great.  Could you tell me more about it?  I've been thinking about how to tokenize renewable energy certificates and carbon offsets so they could be paired with the basic carbon calculators.  Then we could really have some fun (smile)

      2. Peter Clarke

        Token to represent an identity and a separate token to represent fractional ownership in any and every asset conceivable .  However, often the asset itself is held by a third party, or qualified custodian. 

        Where this project has the design thought through correctly can be exemplified by comparing it with an experiment in Bitcoin Futures. The platform is called Bakkt, and is owned by ICE, the parent of the NYSE, several hedge funds and Microsoft. Starbucks is part of the ecosystem.

        The idea of Starbucks using bitcoin for its loyalty program on a trading platform with Fortress and Galaxy Digital, all within the womb of ICE, is about education. The one instrument they trade is a physically settled bitcoin future, which means you must, absolutely must, deliver the physical. To do that requires a lot of miners in China next to a hydro electric dam and Coinbase must be a qualified custodian by law. 

        These are bright and sophisticated folk. What the Fabric platform can do is ping messages back and forth that confirm trades in RECS or a myriad of assets. There is no mining, gas, or domain specific languages like Solidarity and even risk parity hedge fund managers can identify alpha in real time settlement. Lehman would not have happened were there widespread Hyperledger adoption in 2008   

    2. vaneet

      Peter, Great post. Interesting read. Tokenization with scalability must be explored. i think Dematerialization in this context may not be needed, as per my understanding most of utility companies have digital data for emissions. perhaps, i am missing something here. I feel that with hybrid architecture, where we put absolutely put minimum on blockchain, aka the data that must not be tampered. And from there, we proceed to the ideal gradually. Thank you for a great post.

      1. Peter Clarke

        Vaneet

        • Dematerialization:  You are absolutely correct with respect to Emission Registries. The process of 'minting' transfer and destruction/surrender applies, but it is all digital. 
        • Dematerialization is relevant if the Emission Permits are pooled for the purposes of securitization.
        • Blockchain is incredibly hard from the get go. It takes months to understand the basics of gossip protocols and consensus algorithms, so I am amazed at how fast the multiarchitecture and Emission chains are moving. I am actually behind the membership. So, I see tokenization and pre-chain design on the horizon. Putting a stack on a blockchain for fast moving data is how we scale. 
        • Tokens are a cryptographic hash that can represent any asset or identity. What happens next is ownership of a private key, which proves who someone is and a corresponding PIN, biometric scan or Key Card establishes beneficial ownership of tokens representing fractions of electricity or RECs. 



  11. Peter Clarke

    Conor Svensson vaneet Si Chen


    We are happy to set up a tokenisation model on Github. It goes through the cycle of creation or minting, transfer and destruction. The use case is for securities, but 

    a token can represent any asset. Identity, Carbon REC, or device.   

  12. Conor Svensson

    Si Chen and Peter Clarke shall we have a quick call to discuss further? If good I'll move to an email thread

    1. Si Chen

      Conor Svensson Peter Clarke I'm in Los Angeles so GMT-7  I'm available tomorrow morning at 8 AM if that works for both of you?

  13. Peter Clarke

    Conor Svensson Si Chen I am in the UK.  EDT+5  <23:00  

    1. Peter Clarke

      Si Chen Conor Svensson That time works well. 


      I have the following material:

      1. A 2 page document from SOVRIN on the issuance of a DID (Digital Identity) Token.  It's clearly written and a gold standard along with Aries.
      2. An "Endorsement Policy" - This is a JSON file. I can convert it to Text 
      3. A few slides on Tokenization based upon IBM Research peer reviewed technical papers. I focused on the performance testing and business use cases

      This material is for all members. I would be grateful if you could point me to the right place to upload this material. I have a home page or can use a Wiki. 


      Technical 

          4. A couple of networks in ZIP files which I can upload to Github 

          5. Perhaps we could join the 'Emissions' network through Docker Cloud 

      An API dashboard would be pushing it. Let's see how we do.  


      Regards, Peter

      1. Robin Klemens

        Peter Clarke Si Chen Conor Svensson vaneet

        Peter, the material you're talking about sounds very interesting to me. The wiki has a resource section. I think this could be a good place to share. 

        Also, have a look at the ERC-1400 token standard. It "is a hybrid token standard precisely designed for the use case of tokenized financial assets". However, I think the standard could also be applied to climate assets with some adjustments and should serve well as a starting point.

        In a call at the Hyperledger Member Summit today, the Interwork Alliance was mentioned. "The InterWork Alliance empowers all organizations to adopt and use token-powered services in their day-to-day operations, across use cases and networks, bringing inclusivity to globally distributed applications"
        For those who are interested, taking a look at their token taxonomy framework could be worth it. Also, they will host the following meeting next week (17, September 2020) "Unlocking the Business of Sustainability through Tokenization Webinar".

        It would be great if you (Peter, Conor, and Si) could provide a sum-up of your call to the WG. Thank you very much (smile)

        1. Peter Clarke

          Robin Klemens Thank you for pointing me to the right place to share resources. Si  provided help too.

          I have the repositories on my To Do list as well. Kind regards, Peter

          1.  CA2SIGtestchainGRU   https://github.com/CA2SIGtestchainGRU/Sandbox         is a public repository
          2. https://github.com/CA2SIGtestchainGRU/CentralRepo                                          is a private repository

        2. Si Chen

          Robin Klemens vaneet Peter Clarke Anybody else listening:

          We had a very good call with Conor Svenssonand talked about working with tokenization of Renewable Energy Certificates on public ledgers.  One thing we could work on together is to combine our utility emissions on a permissioned ledger with the tokenized REC's on public ledgers to create a Virtual Renewable Energy Network Project, which I think would be a very cool application.

          This also touched on what we were talking about re: key management, since we will have to manage keys to both the permissioned and public ledgers.  Conor Svensson suggested an HSM, such as Azure.  Maybe for dev we can try an open source HSM or a simulator.  Perhaps we can talk more about it on Monday's call.

          1. Kamlesh Nagware

            here more details on softhsm for key management https://hyperledger-fabric.readthedocs.io/en/release-2.2/hsm.html 

            1. Si Chen

              Kamlesh Nagware OK so if I understand correctly, this would replace the keystore/ folder for storing the keys on the fabric ledger.  This is certainly better.  Do you think we could also use HSM in a client application to store the keys?

              1. Kamlesh Nagware

                yes for production grade solutions we should use HSM but it all depends how much privacy we want in our system. Robin Klemens Si Chen

  14. Kamlesh Nagware

    we can also refer this sample in fabric-samples https://github.com/hyperledger/fabric-samples/pull/327

    This PR adds a new ERC20 fungible token sample. It includes javascript
    Chaincode and README about how to use token in the Fabric test-network.

    ERC20 provides basic functionality to transfer tokens, as well as
    allow tokens to be approved so they can be spent by another on-chain
    third party. Most of major tokens on the Ethereum are ERC20 compliant.
    This sample implementation of ERC20 in Hyperledger Fabric will make
    Fabric users utilize the major token protocol.


  15. Peter Clarke

    Si Chen vaneet Kamlesh Nagware Robin KlemensSherwood Moore

     I created a repositories on Github and forked 

    This is for training purposes for developers who are colleagues of mine to familiarize themselves with Blockchain networks first

    All are welcome to join if you are in need of a sandbox to brush up on instantiating chain code or have an interest in working with IBM Blockchain

    Otherwise, we onboard people through Sherwood's landing page and direct them to the Emissions Network.  


    1. Si Chen

      Thanks Peter Clarke  but this link doesn't work: https://wiki.hyperledger.org/CA2SIGtestchainGRU/decentralized-energy-fabric-on-IBP20

      1. Peter Clarke

        CA2SIGtestchainGRU/fabric-samples (github.com)

        My apologies!   This is the link to the repository which includes token generation

        token-utxo/
        Go to file



  16. Peter Clarke

    Here is the link to the repository which includes 

    A Decentralized Energy Network for IBM Blockchain

    1. Si Chen

      Thanks.  Peter Clarkecould you or someone from your team demonstrate this?  Sorry I see a few comments from you and David Dornyoh but don't really see yet how I could work with them.

  17. Kamlesh Nagware

    great..I am also working on similar project for one of my customer

    1. David Boswell

      Kamlesh Nagware – that's great to hear.  If you're able to talk about that project publicly, you'd be welcome to present to the group about it.

      1. Kamlesh Nagware

        yes David , first I need to check with my client whether they can share details.

  18. Peter Clarke

    Si Chen   Robin Klemens    The Emissions Token Network using ZEECs would be a meaningful contribution that we can provision and demonstrate  

  19. Kris Stern

    Hi everyone,

    My name is Kris. I am new to the Climate Action SIG group and would like to become a regular contributor to its open-source project(s). I have been engaged in open-source projects since early 2019, but am new to the HyperLedger community. Looking forward to joining the next bi-weekly Zoom meeting on May 24th, 2021 PST. My GitHub username is "slim-patchy" BTW. 

    1. David Boswell

      Kris Stern – Welcome to the Climate Action and Accounting SIG and that's great to hear you'd like to contribute.  If you have any questions about what the group is doing, feel free to ask on the group's mailing list or chat channel.  And if you have any questions about other parts of the Hyperledger community, feel free to reach out to me at dboswell at linuxfoundation dot org.

    2. David Boswell

      Kris Stern – Welcome to the Climate Action and Accounting SIG and that's great to hear you'd like to contribute.  If you have any questions about what the group is doing, feel free to ask on the group's mailing list or chat channel.  And if you have any questions about other parts of the Hyperledger community, feel free to reach out to me at dboswell at linuxfoundation dot org.

    3. Robin Klemens

      Welcome Kris Stern !!! Looking forward to meeting you in the general CA2SIG meeting tomorrow at 08 AM PST. On Monday, May 24, we'll have the next Peer Programming Call at 09 AM PST. It'd be great to see you there (smile)  Meanwhile you could take a look at the list of good first issues of our Hyperledger-lab blockchain-carbon-accounting and see if you already find a task you are interested in.

  20. Kris Stern

    Thanks David Boswelland Robin KlemensSure, I am interested in joining the call for the general CA2SIG at 8AM PST tomorrow as well as the Peer Programming Call at 9AM PST next Monday. Looking forward to talk to you there soon!