Abstract
Geoengineering is a proposed response to anthropogenic global warming (AGW). Conventionally it consists of two strands: Solar Radiation Management (SRM), which is fast-acting, incomplete but inexpensive, and Carbon Dioxide Removal (CDR), which is slower acting, more expensive, and comprehensive. Pairing SRM and CDR offers a contractually complete solution for future emissions if effectively-scaled and coordinated. SRM offsets warming, while CDR takes effect.We suggest coordination using a blockchain, i.e. smart contracts and a distributed ledger. Specifically, we integrate CDR futures with time and volume-matched SRM orders, to address emissions contractually before release. This provides an economically and environmentally proportionate solution to CO2 emissions at the wellhead, with robust contractual transparency, and minimal overhead cost.
Our proposal offers a ‘polluter pays’ implementation of Long & Shepherds SRM ‘bridge’ concept. This ‘polluter geoengineers’ approach mandates and verifies emissions-linked payments with minimal friction, delay, or cost. Finally, we compare alternative market designs against this proposal, finding that this proposal offers several advantages. We conclude that blockchain implementation of the ‘polluter geoengineers’ approach is attractive and feasible for larger wellhead contracts. We also identify a handful of advantages and disadvantages that merit further study.
Article PDF
Similar content being viewed by others
Avoid common mistakes on your manuscript.
References
Al Kawasmi E, Arnautovic E, Svetinovic D (2015). Bitcoin-based decentralized carbon emissions trading infrastructure model. Systems Engineering, 18(2): 115–130
Antonopoulos A (2014). Mastering Bitcoin—Unlocking Digital Cryptocurrencies. New York: O’Reilly Media
Bayon R, Hawn A, Hamilton K (2012). Voluntary Carbon Markets: An International Business Guide to What They Are and How They Work. Abingdon: Routledge
Brennan M J, Crew N (1997). Hedging long maturity commodity commitments with short-dated futures contracts. In: Dempster M, Pliska S, eds. Mathematics of Derivatives Securities. Cambridge: Cambridge University Press, 165–190
Broeren M L M, Saygin D, Patel M K (2014). Forecasting global developments in the basic chemical industry for environmental policy analysis. Energy Policy, 64: 273–287
Brühl C, Lelieveld J, Tost H, Höpfner M, Glatthor N (2015). Stratospheric sulfur and its implications for radiative forcing simulated by the chemistry climate model EMAC. Journal of Geophysical Research, D, Atmospheres, 120(5): 2103–2118
Bui M, Adjiman C S, Bardow A, Anthony E J, Boston A, Brown S, Fennell P S, Fuss S, Galindo A, Hackett L A, Hallett J P, Herzog H J, Jackson G, Kemper J, Krevor S, Maitland G C, Matuszewski M, Metcalfe I S, Petit C, Puxty G, Reimer J, Reiner D M, Rubin E S, Scott S A, Shah N, Smit B, Trusler J P M, Webley P, Wilcox J, Mac Dowell N (2018). Carbon capture and storage (CCS): The way forward. Energy & Environmental Science, 11(5): 1062–1176
Carl J, Fedor D (2016). Tracking global carbon revenues: A survey of carbon taxes versus cap-and-trade in the real world. Energy Policy, 96: 50–77
Carlsson-Kanyama A, González A D (2009). Potential contributions of food consumption patterns to climate change. American Journal of Clinical Nutrition, 89(5): 1704S–1709S
Celia M A, Nordbotten J M, Bachu S, Dobossy E, Court B (2009). Risk of leakage versus depth of injection in geological storage. Energy Procedia, 1(1): 2573–2580
Chapron G (2017). The environment needs cryptogovernance. NATNews, 545: 403
Chen D (2018). Utility of the blockchain for climate mitigation. Journal of the British Blockchain Association, 1(1): 3577
Chen G Q, Patel M K (2012). Plastics derived from biological sources: Present and future: A technical and environmental review. Chemical Reviews, 112(4): 2082–2099
Chitchya R, Murkin J (2018). Review of blockchain technology and its expectations: Case of the energy sector. http://arXiv preprintarXiv:1803.03567
Coffman D, Lockley A (2017). Carbon dioxide removal and the futures market. Environmental Research Letters, 12(1): 015003
Corbera E, Estrada M, Brown K (2009). How do regulated and voluntary carbon-offset schemes compare? Journal of Integrative Environmental Sciences, 6(1): 25–50
Courtland R (2008). Planktos dead in the water. NATNews, 451: 879
Dai Z, Weisenstein D K, Keith D W (2018). Tailoring meridional and seasonal radiative forcing by sulfate aerosol solar geoengineering. Geophysical Research Letters, 45(2): 1030–1039
Duffle D, Zhu H (2011). Does a central clearing counterparty reduce counterparty risk? Review of Asset Pricing Studies, 1(1): 74–95
Dwork C, Naor M (1993). Pricing via Processing, Or, Combatting Junk Mail. Advances in Cryptology. CRYPTO’92: Lecture Notes in Computer Science No. 740. Berlin: Springer, 139–147
Frunza M, Guegan D, Lassoudiere A (2011). Missing trader fraud on the emissions market. Journal of Financial Crime, 18(2): 183–194
Galenovich A, Lonshakov S, Shadrin A (2018). Blockchain ecosystem for carbon markets, environmental assets, rights, and liabilities: Concept design and implementation. In: Marke A, eds. Transforming Climate Finance and Green Investment with Blockchains. Cambridge: Academic Press, 229–242
Galloway J N, Townsend A R, Erisman J W, Bekunda M, Cai Z, Freney J R, Martinelli L A, Seltzinger S P, Sutton M A (2008). Transformation of the nitrogen cycle: Recent trends, questions, and potential solutions. Science, 320(5878): 889–892
Garman M B (1976). Market microstructure. Journal of Financial Economics, 3(3): 257–275
Gerrard M B, Hester T (2018). Climate Engineering and the Law: Regulation and Liability for Solar Radiation Management and Carbon Dioxide Removal. Cambridge: Cambridge University Press
Giungato P, Rana R, Tarabella A, Tricase C (2017). Current trends in sustainability of bitcoins and related blockchain technology. Sustainability, 9(12): 2214
Green J F (2017). The strength of weakness: Pseudo-clubs in the climate regime. Climatic Change, 144(1): 41–52
Gutknecht V, Snæbjörnsdóttir S Ó, Sigfússon B, Aradóttir E S, Charles L (2018). Creating a carbon dioxide removal solution by combining rapid mineralization of CO2 with direct air capture. Energy Procedia, 146: 129–134
Hamilton C, Turton H (2002). Determinants of emissions growth in OECD countries. Energy Policy, 30(1): 63–71
Haywood J, Jones A, Bellouin N, Stephenson D (2013). Asymmetric forcing from stratospheric aerosols impacts Sahelian rainfall. Nature Climate Change, 3(7): 660–665
Hermann B G, Blok K, Patel M K (2007). Producing bio-based bulk chemicals using industrial biotechnology saves energy and combats climate change. Environmental Science & Technology, 41(22): 7915–7921
Heyen D, Wiertz T, Irvine P J (2015). Regional disparities in SRM impacts: The challenge of diverging preferences. Climatic Change, 133(4): 557–563
Hill S, Ming Y (2012). Nonlinear climate response to regional brightening of tropical marine stratocumulus. Geophysical Research Letters, 39(15): L15707
Hoffman G W (1941) Grain prices and the futures market: A 15-year survey, 1923–1938. USDA Technical Bulletin, 747
IEAGHG (2011) Potential for biomass and carbon dioxide capture and storage. https://doi.org/www.eenews.net/assets/2011/08/04/document_cw_01.pdf
Interpol (2013). Guide to Carbon Trading Crime. Lyon: Interpol Environmental Crime Programme Publications
IPCC (2013). Summary for Policymakers. In: Climate Change 2013: The Physical Science Basis. Contribution of Working Group I to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge: Cambridge University Press
IPCC (2018). Summary for Policymakers. In: Global Warming of 1.5°C —an IPCC special report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty. Cambridge: Cambridge University Press
Jones A, Haywood J, Boucher O (2010). A comparison of the climate impacts of geoengineering by stratospheric SO2 injection and by brightening of marine stratocumulus cloud. Atmospheric Science Letters, 12(2): 176–183
Kaskaloglu K (2014). Near zero bitcoin transaction fees cannot last forever. Proceedings of the Society of Digital Information and Wireless Communication, 91–99
Keith D (2010). Photophoretic levitation of engineered aerosols for geoengineering. Proceedings of the National Academy of Sciences of the United States of America, 107(38): 16428–16431
Keith D W, Wagner G, Zabel C L (2017). Solar geoengineering reduces atmospheric carbon burden. Nature Climate Change, 7(9): 617–619
Kiviat T I (2015). Beyond bitcoin: Issues in regulating blockchain tranactions. Duke Law Journal, 65: 569–608
Kohler P, Hartmann J, Wolf-Gladrow D A (2010). Geoengineering potential of artificially enhanced silicate weathering of olivine. Proceedings of the National Academy of Sciences of the United States of America, 107(47): 20228–20233
Kollmuss A, Schneider L, Zhezherin V (2015). Has joint implementation reduced GHG emissions? Lessons learned for the design of carbon market mechanisms. Stockholm: SEI Working Paper No. 2015–07
Lackner K S, Brennan S, Matter J M, Park A H A, Wright A, Van Der Zwaan B (2012). The urgency of the development of CO2 capture from ambient air. Proceedings of the National Academy of Sciences of the United States of America, 109(33): 13156–13162
Larsen H N, Hertwich E G (2009). The case for consumption-based accounting of greenhouse gas emissions to promote local climate action. Environmental Science & Policy, 12(7): 791–798
Latham J (2002). Amelioration of global warming by controlled enhancement of the albedo and longevity of low-level maritime clouds. Atmospheric Science Letters, 3(2–4): 52–58
Lemieux V L (2016). Trusting records: Is Blockchain technology the answer? Records Management Journal, 26(2): 110–139
Levy J I (2006). Contemplating delivery: futures trading and the problem of commodity exchange in the United States, 1875–1905. American Historical Review, 111(2): 307–335
Lewis S (2016). The Dirty Secret of The Paris Climate Deal. Foreign Policy. https://doi.org/foreignpolicy.com/2015/12/17/the-dirty-secret-of-theparis-climate-deal-carbon-capture-negative-emissions-global-warming/, 2015–12–17
Liebenberg L (2002). The Electronic Financial Markets of the Future and Survival Strategies of the Broker-Dealers. London: Palgrave Macmillan
Locatelli B, Pedroni L (2004). Accounting methods for carbon credits: Impacts on the minimum area of forestry projects under the clean development mechanism. Climate Policy, 4(2): 193–204
Lockley A (2016). Licence to chill: Building a legitimate authorisation process for commercial SRM operations. Environmental Law Review, 18(1): 25–40
Lockley A, Coffman D (2018). Carbon dioxide removal and tradeable put options at scale. Environmental Research Letters, 13(5): 054034
Lomax G, Workman M, Lenton T, Shah N (2015). Reframing the policy approach to greenhouse gas removal technologies. Energy Policy, 78: 125–136
Long J C S, Shepherd J G (2014). The strategic value of geoengineering research. In: Freedman B, eds. Global Environmental Change. Dordrecht: Springer Netherlands, 1: 757–770
MacMartin D, Caldeira K, Keith D (2014). Solar geoengineering to limit the rate of temperature change. Philosophical Transactions of the Royal Society A: Mathematical, Physical and Engineering Sciences, 372(2031): 20140134
Marshall A (1919). Industry and Trade. London: Palgrave Macmillan
Martin P, LoeffMR, Cassar N, Vandromme P, d’Ovidio F, Stemmann L, Rengarajan R, Soares M, González H E, Ebersbach F, Lampitt R S (2013). Iron fertilization enhanced net community production but not downward particle flux during the Southern Ocean iron fertilization experiment LOHAFEX. Global Biogeochemical Cycles, 27(3): 871–881
McClellan J, Keith D W, Apt J (2012). Cost analysis of stratospheric albedo modification delivery systems. Environmental Research Letters, 7(3): 034019
McCusker K E, Armour K C, Bitz C M, Battisti D S (2014). Rapid and extensive warming following cessation of solar radiation management. Environmental Research Letters, 9(2): 024005
Metcalf G E, Weisbach D (2009). The design of a carbon tax. Harvard Environmental Law Review, 33: 499–556
Ming T, Liu W, Caillol S (2014). Fighting global warming by climate engineering: Is the earth radiation management and the solar radiation management any option for fighting climate change? Renewable & Sustainable Energy Reviews, 31: 792–834
Mitchell D L, Finnegan W (2009). Modification of cirrus clouds to reduce global warming. Environmental Research Letters, 4(4): 045102
Moriyama R, Sugiyama M, Kurosawa A, Masuda K, Tsuzuki K, Ishimoto Y (2017). The cost of stratospheric climate engineering revisited. Mitigation and Adaptation Strategies for Global Change, 22(8): 1207–1228
Nalam A, Bala G, Modak A (2018). Effects of Arctic geoengineering on precipitation in the tropical monsoon regions. Climate Dynamics, 50 (9–10): 3375–3395
Noroozi A, Akbari N, Mohammadi M, Yousefiyan K, Ahmadzadegan M H (2018). A review of blockchain. International Journal of Information, Security and Systems Management, 7(1): 745–750
Papageorgiou A, Skordoulis M, Trichias C, Georgakellos D, Koniordos M (2015). Emissions trading scheme: Evidence from the European Union countries. In: Kravets A, Shcherbakov M, Kultsova M, Shabalina O, eds. Communications in Computer and Information Science, Proceedings of Creativity in Intelligent Technologies & Data Science Conference. Berlin: Springer, 222–233
Peters G W, Vishnia G R (2017). Blockchain architectures for electronic exchange reporting requirements: EMIR, Dodd Frank, MiFID I/II, MiFIR, REMIT, Reg NMS and T2S. In: Chuen D L K, Deng R, eds. Handbook of Blockchain, Digital Finance, and Inclusion, 2: 271–329
Pirrong C (2001). Manipulation of cash-settled futures contracts. Journal of Business, 74(2): 221–244
Ploeg F, Withagen C (2014). Growth, renewables, and the optimal carbon tax. International Economic Review, 55(1): 283–311
Poitras G (2009). The early history of option contracts. In: Bronzin V, eds. Option Pricing Models. Berlin: Springer, 487–518
Routledge B R, Seppi D J, Spatt C S (2000). Equilibrium forward curves for commodities. Journal of Finance, 55(3): 1297–1338
Rutkin A (2016). Blockchain-Based Microgrid Gives Power to Consumers in New York. London: New Scientist
Saleuddin R (2018). The Government of Markets: How Interwar Collaborations between the CBOT and the State Created Modern Futures Trading. London: Palgrave Macmillan
Saleuddin R, Coffman D (2018). Can inflation expectations be measured using commodity futures prices? Structural Change and Economic Dynamics, 45: 37–48
Sargoni J, Lockley A (2015). Solar radiation management and the voluntary carbon market. Environmental Law Review, 17(4): 266–269
Stern N, Peters S, Bakhshi V, Bowen A, Cameron C, Catovsky S, Crane D, Cruickshank S, Dietz S, Edmonson N (2006). Stern Review: The Economics of Climate Change. London: HM Treasury
Subramanian H (2017). Decentralized blockchain-based electronic marketplaces. Communications of the ACM, 61(1): 78–84
Takezawa N (1995). Currency swaps and long-term covered interest parity. Economics Letters, 49(2): 181–185
Tilmes S, Fasullo J, Lamarque J F, Marsh D R, Mills M, Alterskjær K, Muri H, Kristjánsson J E, Boucher O, Schulz M, Cole J N, Curry C L, Jones A, Haywood J, Irvine P J, Ji D, Moore J C, Karam D B, Kravitz B, Rasch P J, Singh B, Yoon J H, Niemeier U, Schmidt H, Robock A, Yang S, Watanabe S (2013). The hydrological impact of geoengineering in the Geoengineering Model Intercomparison Project (GeoMIP). Journal of Geophysical Research, D, Atmospheres, 118 (19): 11–36
Truby J (2018). Decarbonizing Bitcoin: Law and policy choices for reducing the energy consumption of Blockchain technologies and digital currencies. Energy Research & Social Science, 44: 399–410
Walch A (2015). The bitcoin blockchain as financial market infrastructure: A consideration of operational risk. New York University Journal of Legislation and Public Policy, 18: 837–892
Zhang X, Aranguiz M, Xu D, Zhang X, Xu X (2018). Utilizing blockchain for better enforcement of green finance law and regulations. In: Marke A, eds. Transforming Climate Finance and Green Investment with Blockchains. Cambridge: Academic Press, 289–301
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
Open Access This article is distributed under the terms of the Creative Commons Attribution 4.0 International License (https://doi.org/doi.org/creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided the appropriate credit is given to the original author(s) and the source, and a link is provided to the Creative Commons license, indicating if changes were made.
About this article
Cite this article
Lockley, A., Mi, Z. & Coffman, D. Geoengineering and the blockchain: Coordinating Carbon Dioxide Removal and Solar Radiation Management to tackle future emissions. Front. Eng. Manag. 6, 38–51 (2019). https://doi.org/10.1007/s42524-019-0010-y
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s42524-019-0010-y