Professional services giant EY has unveiled an Ethereum-based platform aimed at helping enterprises track their carbon emissions, as well as carbon credit traceability. Launched at the EY Global Blockchain Summit in London, the EY OpsChain ESG is available as a beta version on EY’s Blockchain SaaS platform.
Emphasizing the significance of sustainability and environmental, social, and governance (ESG) measures, EY’s platform harnesses carbon emission tokens created by the Microsoft-backed InterWork Alliance, a member of the Global Blockchain Business Council. Blockchain technology’s potential to monitor and record elements of the workflow, from food supply to trade finance, appeals to many organizations.
However, critics assert that blockchain’s energy-intensive nature may offset some of its potential benefits for tracking emissions. The overall pros and cons should, therefore, be carefully analyzed when implementing such technologies.
EY, a strong advocate for public Ethereum blockchain usage for traceability, posits blockchains as the binding force that connects business processes and worldwide ecosystems beyond enterprise boundaries. EY Global Blockchain Leader Paul Brody reiterates that tokens can bring transparency to decarbonization efforts, with traceability enabling tracking of tokenized emissions inventory and linking of carbon output to specific production output. With carbon credit tokens, enterprises can visualize and measure their progress towards sustainability.
Such innovation, however, presents some concerns as well. The energy-intensive nature of blockchain has attracted criticism for its carbon footprint. The verification process, often carried out by vast farms of computers solving complex calculations, consumes considerable amounts of power; some estimates put bitcoin mining’s annual energy consumption on par with that of a small country.
Moreover, carbon credit tokens, while offering a convenient solution to addressing carbon emissions, have far-reaching implications. Relying solely on tokens might divert focus from reducing emissions and improving overall industrial processes, as companies achieve a sense of accomplishment simply by purchasing tokens.
To be reliable, the underlying carbon accounting data must be accurate, which can be challenging for organizations. Inadequate reporting could inhibit the impact and benefits that blockchain’s traceability offers for emissions management.
As with any technological advancement, EY’s Ethereum platform for tracking carbon emissions and credits must be weighed in terms of pros and cons. By addressing potential shortcomings and bolstering its strengths, such platforms could play a vital role in driving businesses’ sustainability efforts and mitigating the detrimental effects of climate change.
Source: Coindesk
