Mission

The mission and goals of the Climate Action and Accounting SIG include "to turn this network into action under a common open source project that defines shared protocols, standards, and platform tools for a globally integrated climate accounting system to be operationalized."

This working group will focus particularly on the "protocols and standards" that will enable consistent climate accounting.  

Work plan for 2022

We coordinate most of the work for this working group through the biweekly Standards WG call. The work plan for the year is set out in this document. The most practical way to get involved is to join this call. Please check the calendar for the next call. 

The 2022 work plan involves four phases:

A. Conceptualisation of a DLT-enabled standardisation architecture to streamline Climate Action & Accounting.

B. Implementing the result of phase A in three different paradigms: as a relational database, as a Radix-Merkle tree (as is used by Hyperledger Sawtooth), and as a token-and-smart-contract network (possibly DAML).

C. Testing applicability to real-life use cases.

D. Reviewing the results from phase C and revisiting phases A-C as necessary.

Progress and opportunities to contribute

Some results from phase A are taking shape under the New ideas, debates and discussions page. Our first realisation is that climate action and accounting is a particular case of environmental accounting or, even broader, of impact accounting in general (e.g., SDG accounting). We described the basic structure of SDG accounting here. We are in the process of elaborating on the ontology, epistemology and semiology (i.e., the description of the things, event and agents that we account for, how we know about each, and how that is represented). 

Please edit the wiki and contribute to our biweekly call.

Clarification

What do we mean by 'standards'?

The term 'standard' is used in a variety of contexts - even within the scope of the CA2-SIG a variety of things are denoted with the term 'standard'. These include:

• technical standards like those of the W3C;

• accounting standards, including:

  • Greenhouse Gas Protocol;  

  • the standards used for compliance purposes in different jurisdictions (e.g., the CDM project standard, California Air Resources Board (CARB));

  • voluntary standards like the Verra's Verified Carbon Standard (VCS), the Gold Standard, Social Carbon, American Carbon Registry (ACR), Climate Action Reserve (CAR), and The Plan Vivo Foundation;

  • standards for entity-level accounting within various scopes; 

  • standards for local/regional/national inventories;

• environmental performance standards like those of the IFC;

• standards related to products; and

• standards for accounting for policy impacts.

What are standards used for?

Standards are used for many things, among which:

• personal climate footprinting

• product/service footprinting

• entity accounting (scope 1, 2 and 3)

• regional accounting

• policy impact assessments

What is standardised?

• Entities: This is the problem of identity. We mean the identity of people, organisations and things. It is needed to connect an unambiguous identifier to all the entities involved in the accounting process. In the case of businesses, this may be difficult because businesses may have complicated structures of ownership and control (see for example Chapter 3 of the GHG Protocol: Corporate Accounting Standard).

• Agency: This is the problem of responsibility - how do we show and prove that an entity (be that a person or organisation) is responsible for a certain action or outcome?

• Activities and events: Agents do things that affect their surroundings at some point in time.

• Counterfactuals: This is the problem of what would have happened if certain decisions had not been taken or certain actions had not been undertaken.  

What will the working group deliver and who will use it?

There are other bodies that create the types of standards mentioned above. This working group will be more concerned with how such standards themselves and compliance to these standards are encoded and captured in a distrubuted ledger and how such representations can be used. 

What is the relationship between standards, authority and freedom in the context of the work of the CA2-SIG?

The CA2-SIG will not act as an authority that compels entities to engage in specific actions. 

The standards to be generated by this working group will enable agents to clearly communicate the implications of their actions. This will enable others to have a clear understanding of the state of affairs regarding the activities and states covered by the standards. 

How will we translate standards into software?

Find the most generic articulation of what a standard, method and transaction is and develop protobuffer examples of each.

• Namespaced Merkle tree 

• Protobuf examples

Taxonomy of protocols, standards, methodologies and certifications

A. Technical methodologies

These are "algorithms" for calculating carbon emissions:

• Life Cycle Analysis (LCA) - this is the standard analytical method for calculating the carbon emissions of a product through its lifecycle.  OpenLCA is an open source life cycle analysis software.
• Product Category Rules (PCR) - these rules define how life cycle analysis should be performed based on the type of product.  See this article for one example of the relationship between LCA, PCR, and EPD.

B. Accounting standards

These are standards for calculating and disclosing carbon emissions.

General standards

• Environmental Product Declaration (EPD) - comprehensive disclosure of the full environmental impact of a product, where carbon footprint is just one variable.  This seems to be used more commonly in building and construction, for example for LEED certifications, but is referenced as a potential source for the Greenhouse Gas Protocol.  See an example of a construction material's EPD and an elevator's EPD.
• Greenhouse Gas Protocol (GHG Protocol) - this is a comprehensive set of standards for measuring greenhouse gas emissions for a company or a product.  It is the base standard for many "carbon neutrality" certifications.
• Carbon Disclosure Project (CDP) - these are voluntary disclosures that companies could make through a series of surveys.  They are used by large companies to disclose carbon emissions to the investor community.

Industry-specific standards

• Whole Building Lifecycle Assessment - specific to buildings and construction, these standards are used to calculate the carbon content of a building based on its construction and materials.  This is important because the largest share of a building's carbon footprint is accrued during the construction  thereof, rather than the operation thereof.  Click here for more about embodied carbon.

Certifications based on accounting standards

These are certifications based on accounting standards, such as the Greenhouse Gas Protocol:

• Carbon Neutral - developed and owned by Natural Capital Partners, which has 20 years of experience and implemented this standard for 300 companies in 33 countries. 
• PAS 2060 - developed by the British Standards Institute (BSI) as an open standard.
• Climate Neutral - a new standard developed by entrepreneurs in the fashion industry and currently run by a nonprofit group.  Their goal is to make it easier for companies to take climate action and become carbon neutral.

C. Carbon offsets

These are standards for carbon offsets and could in turn be divided into sub-categories:

Mandatory

Mandatory offsets are those based on international treaties, such as the Kyoto Protocol or the Paris Agreement, or by government regulations, such as those in the European Union or California.  (I'll leave this category to someone who has more expertise.)

Voluntary

Voluntary offsets are those purchased by companies and individuals to offset their emissions.  There are many standards that govern voluntary offsets – some of the best known ones include:

• Gold Standard
• Verified Carbon Standard  

D. Renewable Energy Certificates

Some background information about Renewable Energy Certificates from PJM. 

Meetings

Join the CA2-SIG Standards WG calls that are held on every other Tuesday of the month at 8 AM US Pacific time (UTC-07:00 America/Los Angeles). Please check the calendar for the next call.