The Relevance of Blockchain for a Global Climate Governance System?

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That climate change is a global problem is hardly news in the second decade of the 21st century. Most, will by now, agree that climate change will hit the hardest and the most vulnerable populations. The need for a global climate governance system, one where social, environmental inequality is considered and properly addressed, is now a salient debate amongst scholars and policymakers.

Climate governance draws from the broader concept of multi-level global governance, which was first introduced by the UN summit in Rio back in 1992 (Jänicke, 2017). This model was created with the objective of achieving “(…) a broad global mobilization of different actors in sustainable development” (Jänicke, 2017, p. 108).

Global climate governance, as a concept, draws from the necessity of a global approach to tackle this global threat; an approach and policy where both global and local actors operate by following horizontal dynamics. As such, “horizontal networks of cities and provinces/states have become global players in climate governance” (Jänicke, 2017, p. 110). By making global climate governance systems easier to run, more private and more democratic, blockchain can play an important role in developing global governance systems.

Blockchain as a solution

The use of new emerging technologies – such as blockchain – for climate change management and response is being widely studied by policymakers and businesses across the world. The United Nations Framework Convention on Climate Change (UNFCC) has already explored, in a 2017 article, the benefits and uses of blockchain technology for climate change action. Amongst the possible uses of this technology, UNFCC states the capacity to improve carbon emission trading, facilitate clean energy trading, enhance climate finance flows as well as a better tracking and reporting of greenhouse gas (GHG) emissions while avoiding double counting. Regarding specifically the benefits of applying a Blockchain technology to a global climate governance system, this transnational system provides the perfect opportunity to develop clean-energy innovation, while allowing “(…) interactive learning and dynamic action within and between levels” (Jänicke, 2017, p. 11). 

Blockchain, as many of you would already know by now, is, at its most basic level, a chain of blocks. The blocks are, in this context, the digital information and the chain is the public database where this data is stored. The greatest advantage of blockchain compared to other digital technologies is its high levels of privacy. By storing the data in a decentralized manner, spread across a network of computers, the chances of the information getting hacked are significantly decreased. Moreover, blockchain technology practically eliminates any possibility of human error and hence provides us with a more accurate record of information. But, how can blockchain technology contribute to the development of a global climate governance system?

In this blog article, I draw from Sven Braden’s 2019 study on Blockchain Potentials and Limitations for Selected Climate Policy Instruments, in order to provide an assessment of the possibilities of Blockchain technology implementation in a global climate governance system. It is important to keep in mind Braden’s core argument: “(…) Blockchain application is especially strong in situations with international dimensions (…)” (Braden, 2019, p.6). Henceforth, a transnational global climate governance system may present itself as the perfect scenario for exploring the benefits of Blockchain technology applications.

Given the scope of this blog news article, I will hereby outline three possible applications. 

  1. First of all, as the 2019 study run by Sven Braden states, “(…) running  climate policy instruments on a Blockchain network can eliminate intermediates and thus reduce costs and increase efficiency”. In a global governance network, this feature could enhance the participation and implementation of least developed, poorer countries that may in other way be excluded from the decision-making process and policy implementations because of their inability to meet the costs.
  2. Second, Blockchain’s high levels of privacy are of special relevance for any climate policy operating across jurisdictions (Braden, 2019, p. 06). Monitoring, reporting and interpreting data on climate finance would be a much more fluent process if all parties involved knew that the information would be treated confidentially and not easily hacked. Aside from the privacy, these policies, reports and datasets would be elaborated following a transparent process. The increased transparency of these negotiations and policies – processes which are commonly out of the general public sphere – could trigger public participation on the climate action debate, enhancing then a multilevel climate governance system.
  3. Finally, another key attribute of a Blockchain network is that “the participants (…) update their database by regularly voting on what happened  (…) within the community” (Braden, 2019, p.14). This feature is of extreme relevance for any policy applications of this technology for it would create a transparent, democratic system. Henceforth, all actions and new additions to the network would be based on democratic principles and considered following all parties’ participation. 

In conclusion, Blockchain technology provides us with a useful framework for tackling the development of a global climate governance system.  Although further research needs to be done and possible indirect implications need to be addressed, from a social justice and democratic point of view, a  Blockchain network can contribute to climate governance by (1) enhancing participation of all countries, (2) enhancing knowledge on climate decision-making processes to the general public and hence promoting non-state actors participation; and (3) working under democratic principles in the development of climate policies by voting on network updates. 


Sources:

Jänicke, M. (2017). The Multi-level System of Global Climate Governance – the Model and its Current State. Environmental Policy and Governance (27), 108-121. DOI: 10.1002/eet.1747 

UNFCCC (2017, June 1). How Blockchain Technology Could Boost Climate Action. United Nations Climate Change. Retrieved from: https://unfccc.int/news/how-blockchain-technology-could-boost-climate-action 

Reiff, N. (2020, February 1). Blockchain Explained. Investopedia. Retrieved from: https://www.investopedia.com/terms/b/blockchain.asp 

Braden, S. (2019, March). Blockchain Potentials and Limitations for Selected Climate Policy Instruments. Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. Retrieved from: https://www.climateledger.org/resources/Blockchain-Potentials-Climate-Policy_2019.pdf

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