Energy and emissions reporting isn’t something most people think about. Unless, that is, you’re an environment or sustainability officer in a business or industrial operation. In that case, chances are you spend a lot of time thinking about it.
To help meet reporting obligations under the United Nations Framework Convention on Climate Change, countries set up inventories for reporting greenhouse gas emissions by source, sector and sink. Typically, these inventories are informed by data collected through regulatory obligations on large emitting corporations or industrial facilities. For example, Australia has the National Greenhouse and Energy Reporting Act 2007, Canada establishes carbon and greenhouse gas legislation at a provincial level, and the UK has the Climate Change Act 2008. And so on.
These legislative obligations (part of MRV - ‘monitoring, reporting and verification’ in climate policy lingo) are also the foundation for carbon pricing schemes. So you’ve got a double incentive to make sure those reports are accurate – not just to meet your obligations, but to make sure you’re not paying any more carbon tax than you need to.
Yawn. What does this have to do with making Power Ledger’s POWR token an investment worth your time?
Well, compiling these emissions reports is a very detailed and tedious task. They can also be intensive from an audit perspective (up to AUD $600K-$1 million a year is an anecdotal figure, straight into the pocket of a Deloitte or KPMG). Audits are difficult to do properly, and good auditors have questions forcing you to produce and explain things like energy flow diagrams, energy apportionment between industrial products, or site-specific sampling. This is really techy work that takes up a lot of time and expense.
For environmental integrity, emissions reports lean towards the conservative side (i.e. reporting more emissions) even though your physical emissions might be lower due to, for example, the time of day you consume your energy. Getting credited for these things is possible, but it means stepping up to ‘higher order’ measurement methodologies, and that means more audit costs.
The detailed energy consumption data that could be collected for Power Ledger clients might make these processes a hell of a lot simpler. Being able to point to your data on a transparent, immutable blockchain might well be a way to slash audit costs. Would there be opportunities to link Power Ledger’s blockchain directly to carbon trading registers? This is another potential use case for the blockchain, such as for China's budding ETS. Time will tell.
There are plenty of other interesting use cases for the blockchain energy platform which establishes itself first. On the strength of Power Ledger’s announcements through their ICO (still open for a little longer yet), this could be a serious contender.