Please describe your proposed solution.
The problem
The certification industry is today, like banks, a very manual heavy compliance organization.
Today the certification industry is build up apun trusting central organizations internal governance, compliance rules and the incentives of the people working there - just like old banks today. Today banks are facilitating payments of huge amount of money and have therefore, over decades, built and implemented comprehensive and rigid manual compliance structures to make sure the system is balanced. The same goes for the centralized certification industry which have build their organizations around manual compliance and governance to offer a trusted service of varified carbon credits. The problem is that for the certification of industry to keep upholding their value proposition to the market they rely on the world being non-transparent. If the world was 100% transparent, who would need huge organizations to trust? The certification industry work with trusted bodies who are validating the data that the carbon projects produce. These bodies are all heavily dependent on doing manual work and paid by the hour. These bodies have no incentive to create transparency, because who would then need them?
The certification industry can not change and become transparent because it would mean removing their economic foundation.
The voluntary carbon industry take 80-70% of carbon credit revenue from the project owners who are doing the work on the ground!
Research: http://www.indiaenvironmentportal.org.in/files/Offsetting_with_CDM_credits.pdf
Scott Poynton, one of our team members and a leader on sustainability issues, wrote the book; “Beyond Certification” which gives insight into the issues and challenges of the certification industry in agriculture supply chains. You can download the book here.
The teams long term vision is:
Today the three largest challenges towards stopping climate change are:
- Knowledge on what to do to stop climate change. A lot of government and private research is done on how to stop climate change, but very little are converted into actionable items we can all execute on based on our situation and competencies.
- No financial feasibility because of certification industry. Today, to remove carbon from the atmosphere, you need to be certified by an industry player which cost approximately 70% of all potential profit from carbon credit sales.
- No scalable solution to support the change. There are no scalable solution today to support the millions of people and organizations wanting participate in removing the desperately needed carbon and no scalable solution for how they can prove and validate the impact they want to do.
The proposed solution
This proposals solution address the second and third challenge above by offering a new way for carbon removal projects to be certified at a fraction of the cost of what the established industry charges today by enabling a world wide community of capable and motivated people.
The solution is a verified members only web application that combines all collected data sources from each carbon removal project and displays it to a community for people with different skills and competencies. The community can for every project oversee the collected data, flag missing data, dispute data etc. with the goal of validating carbon removal projects and their progress decentralized. The overall goal of the decentralized community tasks are to; approve new carbon removal projects, request more data for further evaluation, validate a projects progress, estimate the amount of carbon credits etc.
All data, identities and verification will be documented transparently on the Cardano blockchain for everyone to see and verify.
The data sources used for the community members could be:
Self Reporting: People owning the projects can report data on crops, fertilizer, soil, seedlings, weather, project progress, images as documentation, workflow documentation, work practices etc.
Satellite data: Can be used for estimating land condition; crop, humidity, soil moisture, temperature etc.
Validators: NGOs like The Pond Foundation are in their work supporting a variety of different projects and will be able submit independent observations and interventions.
Registries: Local and global registries for taxation, land ownership, business registrations, GIS data etc.
The first use case will be with the Pond Foundation currently working on the ground i Ghana building a new sustainable agricultural supply chain with local farmers. The use case will be validating 10-30 ghanaian farmers using biochar to fertilize their soil as a carbon removal project.
Pictures from the Pond Foundations project in Ghana and satellite imagery from GAMAYA.
The data sources for this first use case will be satellite data from GAMAYA and data collected by the validator from each farmer by the Pond Foundation team. The community members will be recruited through the Cardano4Climate community and the team members professional network.
More info on the general project here: <https://docs.google.com/document/d/1pFIlHzkOQOsRZGTTo4MQIk1sM6bAGtTMolr25Y1PC5c/edit#>
Value for customers and users
This solution will, if scaled, be able to disrupt the multi billion carbon removal certification industry and democratize access for, not just landowners, but everyone to be part of the community helping to fight climate change and earn a supporting income. Today the customers wanting to buy carbon credits on the voluntary market will have to pay a very high price to mitigate the risk of fraud through expensive certification bodies. The proposed solution will enable customers to buy carbon removal credits with full transparency into the data for each project and multi layer verification from the community which will decrease the risk of fraud dramatically. As mentioned above only 20-30% of the revenue from the sale of carbon credits go directly to the people working on the ground.
Please describe how your proposed solution will address the Challenge that you have submitted it in.
This solution will directly impact the amount of CO2 sequestered because the proposed solution will be able to scale and democratize carbon removal certification globally - simply more people will be able to help remove carbon and a global community will support them all the way. If success is reached and thereby a new way of proving carbon removal, the whole world will know and awareness will be massive.
The challenge brief also state:
“The more interesting and useful the products and integrations are that can be built in the ecosystem the more reasons people have to interact with the Cardano blockchain that can help further drive more adoption, feedback, growth and even more innovations.”
This proposal is fully aligned with this brief. Cardano has a big interest in Africa, where agriculture done by smallholder farmers is a key economic and social factor. Providing such a solution directly impact farmers livelihood and will increase adoption & innovation supporting “bank the unbank” vision of Mr. Charles Hoskinson.
This proposal can scale and relate to:
Carbon Marketplaces
Physical products - Carbon credits
Nation governance systems - New governance systems for nation-states
Environment - Solutions that help to solve environmental issues
Sort of DeFi connecting to Microfinance and micro payments for Carbon mitigation.
What are the main risks that could prevent you from delivering the project successfully and please explain how you will mitigate each risk?
Challenge 1: We know building a community is hard, but we belive there is a huge opportunity to turn the widespread climate fatigue into climate action by showing there is a way for everyone to contribute and feel useful. We will start with a focus on the existing Cardano4Climate community, local university students, local climate experts and with support from the experts from the Pond Foundation.
Challenge 2: Making the unit economics sustainable enough to support all stakeholders will be a challenge. The current strategy is for customers buying the carbon credit to pay a premium on top, given the level of transparency and this way support the participating community.