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A comprehensive hierarchical blockchain system for carbon emission trading utilizing blockchain of things and smart contract

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  • Sadawi, Alia Al
  • Madani, Batool
  • Saboor, Sara
  • Ndiaye, Malick
  • Abu-Lebdeh, Ghassan

Abstract

Climate change is a major issue that has disastrous implications on the environment, which, if continued, will cause severe consequences. One of the leading causes of climate change is the emissions of harmful gases, particularly CO2. In 1997, the Kyoto protocol was signed by 192 countries, creating a system that monetizes CO2 emissions with an aim to control them. Most countries signed a carbon trading scheme, but the scheme fell short of its goals due to manipulation, lack of integrity, and multiple other challenges. This work presents an improved blockchain-based approach to achieve the objective of monitoring the reduction of carbon emissions. Blockchain's distinct features such as security, immutability, transparency, traceability, and trust, make it a robust and reliable solution for the carbon trading market. Previous Blockchain-based proposals were not comprehensive, practical, applicable, or efficient enough to form an effective solution. This research addresses the current gaps and proposes a comprehensive three-stage hierarchical blockchain framework that employs smart contracts in Blockchain of Things (BoT) to ensure integrity in the system and reach fair trade status that favors the environment over companies' cost reductions and profit-making. The result is an optimized carbon emission trading framework, fully transparent with automated trading and control mechanisms.

Suggested Citation

  • Sadawi, Alia Al & Madani, Batool & Saboor, Sara & Ndiaye, Malick & Abu-Lebdeh, Ghassan, 2021. "A comprehensive hierarchical blockchain system for carbon emission trading utilizing blockchain of things and smart contract," Technological Forecasting and Social Change, Elsevier, vol. 173(C).
    • Handle: RePEc:eee:tefoso:v:173:y:2021:i:c:s0040162521005576
    DOI: 10.1016/j.techfore.2021.121124
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    References listed on IDEAS

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    6. Li, Qingqing & Shi, Jinbo & Ni, Kan & Wang, Ruohan & Zhang, Chongyi & Yang, Nan & Yang, Yifei & Shen, Yifan & Guo, Ru & Liao, Zhenliang, 2024. "A highly credible and efficient real-time carbon MRV + O system for delicacy management of distributed carbon abatement behaviors," Applied Energy, Elsevier, vol. 355(C).
    7. Savelli, Iacopo & Bokkisam, Hanumantha Rao & Cuffe, Paul & Morstyn, Thomas, 2023. "On-demand energy flexibility market via smart contracts to help reduce balancing costs in Great Britain," Energy Economics, Elsevier, vol. 126(C).
    8. Yang, Xiaohui & Zhang, Zhonglian & Mei, Linghao & Wang, Xiaopeng & Deng, Yeheng & Wei, Shi & Liu, Xiaoping, 2023. "Optimal configuration of improved integrated energy system based on stepped carbon penalty response and improved power to gas," Energy, Elsevier, vol. 263(PD).
    9. Qin, Meng & Su, Chi-Wei & Lobonţ, Oana-Ramona & Umar, Muhammad, 2023. "Blockchain: A carbon-neutral facilitator or an environmental destroyer?," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 604-615.
    10. Chung, Kenneth Hsien Yung & Li, Dan & Adriaens, Peter, 2023. "Technology-enabled financing of sustainable infrastructure: A case for blockchains and decentralized oracle networks," Technological Forecasting and Social Change, Elsevier, vol. 187(C).
    11. Li, Yan & Feng, Tian-tian & Liu, Li-li & Zhang, Meng-xi, 2023. "How do the electricity market and carbon market interact and achieve integrated development?--A bibliometric-based review," Energy, Elsevier, vol. 265(C).
    12. Renjie Zhang & Hsingwei Tai & Kuotai Cheng & Huizhong Dong & Wenhui Liu & Junjie Hou, 2022. "Carbon Emission Efficiency Network: Evolutionary Game and Sensitivity Analysis between Differentiated Efficiency Groups and Local Governments," Sustainability, MDPI, vol. 14(4), pages 1-19, February.
    13. Ma, Jinjin & Yang, Lin & Wang, Donghan & Li, Yiming & Xie, Zuomiao & Lv, Haodong & Woo, Donghyup, 2024. "Digitalization in response to carbon neutrality: Mechanisms, effects and prospects," Renewable and Sustainable Energy Reviews, Elsevier, vol. 191(C).
    14. Zhang, Wei & Li, Guoxiang & Guo, Fanyong, 2022. "Does carbon emissions trading promote green technology innovation in China?," Applied Energy, Elsevier, vol. 315(C).

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