🌿Carbon Credit Accountability Initiative: Illuminating the Path to Verifiable Emissions Reduction

[GENERAL] Name and surname of main applicant

Vivek Nankissoor

[GENERAL] Email address of main applicant

vivek@msvn.ca

Additional applicants

Michael Stewart - mike@msvn.ca

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

2

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language.

No

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.”

No dependencies

[GENERAL] Will your project’s output/s be fully open source?

Yes

[GENERAL] If NO, please describe which outputs are not going to be open source. If YES, please write “Project will be fully open source.”

Project will be fully open source.

[METADATA] Category of proposal

dApp

[IMPACT] Please describe your proposed solution.

The Current State

The Carbon Credit industry is rapidly growing due to several factors:

1. The scientific community has come to a strong consensus that climate change is an issue that we need to address: https://en.wikipedia.org/wiki/Scientific_consensus_on_climate_change
2. Governments have established targets for reduced carbon emissions:
3. Canada: https://laws-lois.justice.gc.ca/eng/acts/C-19.3/
4. US: executive order 14057 and sustainability plan
5. Industry emission reduction technology is not advancing fast enough for companies to meet mandated targets within the specified timelines. As such they need to purchase Carbon Offsets to avoid fines/penalties. E.g., companies like Shell are investing in carbon credits
6. Current demand far outweighs supply of carbon credits resulting in rapid expansion of carbon credit producers and other organisations in the upper end of the value chain (e.g., producers, certification entities, auditors, registries)

As a result of this dynamic, carbon credits are a necessary part of the economy and take the form of tokenized commodities. They are generated by Projects, traded on Registries, and consumed by Industries. Carbon credit registries have already embraced blockchain to serve as tokenized carbon credit exchanges. This is a simplified version of the ecosystem, but detailed and accurate enough for the scope of this proposal.

The Problem

There are multiple problems that exist in the current system that can be addressed by a technical solution. Most blockchain-first organisations are rushing toward becoming a registry, and while the technology is a good fit, the problem is not that there are too few registries (at the moment). The problem is one of transparency.

Like any new marketplace, the quality of carbon credits vary significantly. There are many opportunists who are flooding the market with low quality carbon credits (aka credits produced from poorly managed projects). Discerning carbon credit consumers have a tough time identifying “good” carbon credits from “bad” ones.

A “good” carbon credit is one where the project follows strict methodologies and reporting requirements. These methodologies are designed to ensure that the project is, in fact, set up to remove the amount of carbon that it claims to. A “bad” carbon credit is one that either uses poor methodologies, or has poor controls and reporting. This can lead to sub-par performance and effectiveness in removing the stated amount of carbon from the ecosystem. Furthermore, these methodologies and reporting guidelines are ever-evolving, making it difficult to employ hard and fast rules or classification criteria.

Buyers need full access to projects’ methodologies and data to be able to make an informed decision. Each buyer can then determine if the projects they are evaluating fit within their risk threshold.

The use of blockchain technology, specifically Cardano, appears to be a good fit to ensure transparency across the entire value chain. This would allow projects to “market” themselves as high quality carbon credit producers, and it would allow industries/buyers to select the projects that are right for them. 

These assumptions need to be validated by experts at all stages of the value chain: from project owners, to registries, to industry buyers. As with most systems like this, there can be complexities that would only surface through a feasibility study, or worse, after a product MVP has been developed and faces the challenge of lack of adoption.

The Solution

To verify the problem statement and confirm interest in a product that would provide transparency, we propose a feasibility study. The feasibility study would consist of interviews with industry experts and result in a document outlining the following:

• Technical Feasibility - does the use of the Cardano blockchain meet the technical requirements of the potential solution?
• Legal & Regulatory Feasibility - are there regulations or legal requirements that prohibit the development and adoption of the potential solution?
• Organisational Feasibility - are the current involved entities capable of accepting/adopting a technical solution to address the problem of transparency
• Social Feasibility - if a product would help solve the problem of transparency, would the people involved be interested in using it?
• Economic Feasibility - would potential users of the product have the budgets required to cover the development and operational costs of the platform?

Based on the outcome of the feasibility study, we will determine if it’s possible to leverage the Cardano blockchain to create a product that meets a need in the carbon credit ecosystem. If it does, then we can pursue a Cardano-based solution to a real-world problem, legitimising the use of blockchain in mainstream industry.

NOTE: the structure of the document may change depending on ongoing investigations/assessments.

[IMPACT] How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?

This project aims to pave the way for a mainstream product built on Cardano. Far too often, products fail because too little research is done or the problem is not well understood. Prior to a full blown product build, an MVP (minimum viable product) should be developed. Prior to an MVP, a business plan and feasibility study should be conducted. Taking these steps will either raise the probability of success significantly, or reveal that building a product for this purpose is not a good idea.

Either way, the outcome benefits Cardano. If building a product is not a good idea, then valuable funds would have been saved instead of sunk into a failed project. If the feasibility study reveals that the idea is reasonable, then we’re closer to mainstream adoption of the Cardano blockchain in a quickly expanding ecosystem.

[IMPACT] How do you intend to measure the success of your project?

The success of the project will be measured by:

• Completion
• A researched position on whether or not the problem can be solved (and a product can/should be built) using Cardano

[IMPACT] Please describe your plans to share the outputs and results of your project?

We will publish the resulting document and any relevant decisions, methods, interview notes etc.

[CAPABILITY/ FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability?

The success of this project depends on several factors:

1. A good understanding of Cardano and how it can be applied. As builders in Cardano (we built Voteaire, we are also known as Canucks Publishing: NFT minting, staking platform development, auction house development, several smart contract integrations, etc.), we have intimate knowledge and experience in what’s required to bring a product to market.
2. Carbon Credit industry knowledge. We have professional contacts in the Carbon Credit industry at companies such as Invert (https://www.invert.world/) and AirMiners (https://airminers.org/). These contacts are, in turn, connected throughout several relevant organizations.
3. Data and analytics background. Our professional background includes decades of experience in enterprise data management and systems designed for data transparency and lineage. Our professional experience has positioned us well to understand the niche that the proposed product would fill, and its value to large organizations.

[CAPABILITY/ FEASIBILITY] What are the main goals for the project and how will you validate if your approach is feasible?

The main goals of the project include the completion of a feasibility study that include research into the following areas as they relate to the Carbon Credit industry:

• Technical Feasibility
• Legal & Regulatory Feasibility
• Organisational Feasibility
• Social Feasibility
• Economic Feasibility

Given that we have the ability to connect with and interview the people who can help with this research, the feasibility of completing this project is excellent. Even if we did not have the opportunity to connect with specific individuals, there are programs such as AirMiner’s boot camp (https://airminers.org/) that are designed to provide the information necessary to gain a good understanding of the opportunity space that we are exploring.

[CAPABILITY/ FEASIBILITY] Please provide a detailed breakdown of your project’s milestones and each of the main tasks or activities to reach the milestone plus the expected timeline for the delivery.

The project milestones include:

1. Planning
2. Qualitative Research: Interviews, meetings, etc.
3. Problem-oriented Research: Publications, articles, etc.
4. Draw inferences/conclusions
5. Draft documentation
6. Revise and complete documentation

[CAPABILITY/ FEASIBILITY] Please describe the deliverables, outputs and intended outcomes of each milestone.

1. Planning - DELIVERABLE: project plan
2. Qualitative Research - DELIVERABLE: list of who was contacted and key findings
3. Problem-oriented Research - DELIVERABLE: list of materials reviewed and key findings
4. Draw inferences/conclusions - DELIVERABLE: summary of key findings and what it means for the overall feasibility of a product
5. Draft documentation - DELIVERABLE: rough draft of output
6. Revise and complete documentation - DELIVERABLE: final document

[RESOURCES & VALUE FOR MONEY] Please provide a detailed budget breakdown of the proposed work and resources.

1. Planning - $2,100
2. Qualitative Research = $5,600
3. Problem-oriented Research = $4,700
4. Draw inferences/conclusions = $2,600
5. Draft documentation = $1200
6. Final document =$1800

[RESOURCES & VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

Building infrastructure for the emerging carbon market industry will bring incredible volume. The key advantage would be adoption, opening the door for future products, systems, and infrastructure to be built on Cardano.

This industry is driven by government mandates for companies to meet drastic emissions reduction targets by 2030 and net-zero targets by 2050. Company budgets that were previously spent on fossil fuel commodities and emission reduction R&D will be redirected toward carbon offsets to meet the government mandates. To do otherwise exposes these companies to hefty fines.

[IMPORTANT NOTE] The Applicant agreed to Fund10 rules and also that data in the Submission Form and other data provided by the project team during the course of the project will be publicly available.

I Accept