 Hello, my name is Sai Chen from Open Source Strategies and today we're here to talk about flighting climate change with blockchain and open source. So this is not going to be your usual climate talk because, well, I'm not your usual environmentalist. My background is I was a hedge fund manager and about 20 years ago I started an e-commerce company with my wife and being a small startup with very little money, we naturally didn't have the budget for a big expensive commercial software package. So I started working with open source software, first with a CGI Pearl shopping cart and then I found out about a Java project. So I actually learned Java just to be able to work with it, took me about six months. But eventually I became a committer of this open source project which became part of the Apache Foundation. And I can honestly say looking back that open source software, specifically its flexibility is what's made us a successful business today. And so I started my company Open Source Strategies really with a goal to develop a market open source software. So now looking at climate change, this is something that always fascinated me when I was a hedge fund manager is I always saw climate change as a failure of the market. A lot of us in open source are familiar with something called the tragedy of commons, right? Something that's owned by everybody, nobody will maintain it and keep it up. Well climate change is about the biggest tragedy of the commons out there. And then another important thing I learned in e-commerce is you have to give people what they want, otherwise it's very hard for people to get to do what you ask them to do. And finally with open source, I saw that innovative bottoms up approaches are the right way to solve problems. And looking at open source today, I feel that we finally have the solution for climate change right here in front of us. And that's what I want to talk about today. So not being the usual climate talk, I'm going to start with good news. And the good news about climate changes, I think we're coming to a tipping point of really being able to solve this problem. First of all, the technology is there. Renewable energy, electric vehicles, they're commercially viable and scaling up now. Second of all, people all around the world see climate change as a serious problem, and they want solutions. 70% of the people worldwide think that climate change is a serious problem, and only 3% think that it's not serious at all. And very importantly as part of this, investors, major investors of public and private pension funds like BlackRock, the Nezero asset owner's appliance, the Climate Action 100, these people control trillions of dollars of assets, and they're demanding that the companies they invest in do something about climate change. And finally, as a result of all these three other forces coming together, businesses are taking action. We're talking about the tech giants. We're talking about IKEA, Kerry, which is a parent company of Gucci, one of the largest luxury goods manufacturing in the world. They've all committed to being carbon neutral. But in addition to that, you've probably not heard that Dominion Energy and Duke Energy, two of the largest utilities in the United States, have also made these commitments. Delta Airlines, the world's biggest airline, Lyft, and most amazingly, Shell, they've all committed to being climate neutral. So all these pieces are lined up, and we just need to coordinate them. And some more good news is that managing emissions is actually not hard technically. Okay, we have data on activities of all kinds. Utilities, travel, flights, shipping, things that you buy. And for each of those, we roughly know how much emissions, how much greenhouse gas emissions they're causing. And so by multiplying the two together, we could figure out the emissions for a person, for a company, for a country, and it's just a matter of taking action. And that could be by investing in renewable energy through renewable energy certificates, by investing in carbon offsets, which are forests and land use mitigation, and a variety of other measures that basically remove carbon dioxide from the atmosphere. And finally, by participating in efficiency programs that make the things that we do more efficient in terms of emitting less emissions for the same amount of activity. So now that we have all the pieces together, and this is the process, all we need is data, trust and coordination to get this done. Looks easy, doesn't it? Okay, well, unfortunately, the first big hurdle we're going to run into is can we actually trust emissions data? So companies' emissions data are based on self-reported surveys. Very few companies actually record this kind of data. It's up to a few thousand companies at this point, out of the millions and millions of businesses in the world. And the data that you get back is not very accurate. Let's just face it. So unfortunately, monitoring emissions and carbon offsets is both expensive and time-consuming at this point. And then the coordination is going to be the second big hurdle that we run into. Who exactly in the government could actually coordinate climate action? Well, out of the major causes of greenhouse gas emissions in the United States, the biggest ones are transportation, electric power and industry. So transportation is regulated, transportation emissions is regulated by the EPA, National Highway Transportation Safety Administration, the California Air Resources Board, and for airline flights, the FAA. But guess what? There are actually 10 agencies within the United States Department of Transportation that regulate intermodal or freight and logistics transportation. But that's not too bad compared to electric power, which is regulated by a Federal Electric Regulatory Council, nine independent system operators of utilities. A public utility commission in every state plus every city has its own building codes that basically govern how buildings are supposed to be energy efficient and therefore how much energy we would all use. So this is potentially hundreds of agencies involved here. Meanwhile, on the other side, industry, industrial greenhouse gas emissions, basically not regulated. Cement, if cement were its own country, cement making in the world, it would be the third largest emitter in the world. There's no agency in the United States that regulates that. Steelmaking, the EPA wrote a draft proposal on regulating steel industry greenhouse gas emissions in 2009. And that's where it's basically set. So here's the situation in our country. It's either regulated by all these different agencies or there's nobody regulating it. And guess what? There's 195 countries in the world. So how many agencies in total would have to work together and how much could they actually cover? But in the absence of a credible central authority, we don't have to panic anymore because there are two tools that we can use. One is the blockchain and one is the open source. The blockchain is really the technology. It's the tools that allow us to gather data efficiently and build trust and collaboration without a central authority. An open source is kind of like the spirit of doing things. Our sense of transparency, inclusiveness, flexibility, and innovation. And together, we could actually get this done. OK, so first of all, let's just talk a little bit about blockchain to clear some things up. What is the blockchain? The blockchain is basically a software that stores data as blocks, which are then linked together by hash keys, hence a chain of blocks or a blockchain. And it uses private key encryption, so the data is private and secure. The data is stored across multiple redundant peers so that it's immutable, it doesn't get lost or altered. And finally, there's consensus algorithm that guarantees that the data is true, meaning it hasn't been tampered with, it's consistent over time without needing a central authority to certify that the data is good. So the benefits of the blockchain, it's pretty interesting what it does, right, is first of all, it allows us to trust something without a central authority. And second of all, this is more interesting in today's internet, it gives us proven identities of people who are interacting with each other. Again, without a central authority to issue your usernames and passwords. And finally, it allows us to share data publicly while preserving privacy. So we're used to thinking of either data being private or it's publicly available somewhere on the internet, but the blockchain allows that third option, which as we'll see becomes very important. Some of the major blockchains out there, you've probably heard of Bitcoin. Bitcoin is pretty cool because it's cryptocurrency that doesn't involve banks in the middle of transactions. And people are trusting billions of dollars to Bitcoin and to other decentralized finance blockchains. So if anybody asks you, is the blockchain really used in production? Well, of course it is. It's used to literally store billions of dollars of value right now. The other cool blockchain technology that came along a few years ago is Ethereum. And Ethereum is designed to be the world's virtual computer. They came up with something called the smart contract, which is software code that runs on the blockchain. It's literally an open source piece of code that runs on every node of a blockchain so that they all are able to generate the same results. And finally, another important blockchain technology is Hyperledger. This is an open source blockchain of the Linux Foundation. And it's backed by all the major companies in tech and a lot of the big banks as well. And what it's created is a permissioned and highly efficient blockchain that could be used for business applications. So unlike Bitcoin and Ethereum work, anybody can basically jump in and anonymously or pseudo-anonymously transact. Hyperledger allows you to include only the members that are part of a trusted network to transact together on a blockchain. And finally, just to clear up what the blockchain is not. The blockchain is not just Bitcoin. Bitcoin is one thing that's been implemented with the blockchain technology, kind of like AOL or CompuServe were the early days of the internet. The blockchain is also not just ICOs, which were these cryptocurrency coin offerings from a few years ago. The blockchain is not immature technology, as you can see from what we talked about, because it is being used for a lot of production applications. And finally, some people have said, well, we don't want to use the blockchain because it's bad for the environment. Blockchain is very energy intensive. The truth is some of the older blockchain networks, like Bitcoin and like the original Ethereum that we're currently using, used a proof-of-work consensus algorithm that is energy intensive. I think that they got a lot bigger than perhaps the original creators that ever thought would be the case. But newer blockchain technologies are all getting away from that, and they run pretty efficiently and more importantly for the blockchain developers very quickly, very fast compared to the older proof-of-work technologies. So we're all shifting away from that energy intensive model of before. So how are we using this for emissions? Well, here's an example. Let's take utility emissions, one of the biggest source of emissions in the United States and the world. You start with something like a utility bill, and you get that data through something called the green button standard, which is a standard XML format for utility billing and usage data into a software, which in this case is an open-source system we developed called OpenTaps. It's written in Python using the Django framework. That connects to something called the Hyperledger Fabric SDK, which runs on Node.js using a REST interface, which then connects to Chaincode running also in Node.js but actually on a Hyperledger Fabric network. And this we're currently using DynamoDB to get data that we need to do the calculations, and we're looking to use IPFS to store encrypted archival data like your utility bills. So what this does is it automates the data acquisition from utilities and it'll store the data across redundant nodes and open-source Chaincode is being run all those nodes. So the whole process basically gets the data and passes it through open-source software that anybody can inspect and then stores it securely and immutably on the ledger to make people trust any admissions calculations that we're getting. And meanwhile, on the other side of the world, in the open-source community of Hyperledger, this company, Web3 Labs, they've developed something called EPRUS, which is a Java client for Ethereum. So we're able to take carbon offsets and renewable certificates which are certified by entities that review them and certify them, like the gold standard to verify carbon standard and tokenize them on a public or private Ethereum network. So here's what it looks like. This is an open tabs and this shows an example of data coming from a utility bill. It passes through this code which sits behind a REST interface. So even though our software is written in Java, this can work in Node.js and it uses a wallet to communicate with a gateway to this thing called the Utility Emission Channel and to call a contract on that network to basically execute a storing of data on a Hyperledger Fabric blockchain. And this is an example of code that actually runs on Hyperledger Fabric. As you can see, it's also written in Node.js and so basically it's actually pretty straightforward. It gets data in here, does some calculations and then it just waits for the data to be stored in Fabric. And this is actually an example of a block of data being stored in Hyperledger Fabric. And meanwhile over here is an example of a carbon token created by EPRESS on a private Ethereum network. So from those little pieces, let's imagine that we could scale this up instead of just having utility data. Let's also get your car to tell us its travel data. Let's sync with a travel system like Concur to get flight information and let's sync up with UPS, FedEx or services like Flexport to get your logistics shipping the information and on and on for all the major categories of the greenhouse gas protocol. And we can put all that data on the different channels on permission ledgers like Hyperledger Fabric. And on the other hand, we can get carbon offset from forestry, from agricultural projects, renewable energy certificates from solar and wind and even satellite monitoring of different types of projects directly and tokenize all of those and make those available. So that we have the two sides of both emissions accounting with trusted data and tokens of climate action, basically emission reduction measures. So when we have these two together, then we can do something really cool with the blockchain. Let's think about what happens in climate action. Here's a simple use case. Let's say that there's a company, like one of the major companies we talked about early in the presentation and they wanna sponsor a carbon neutrality program. They wanna eliminate the emissions of their company. And so what do they need to do? They need to obviously make a budget available and engage a group of experts to help make decisions about what kind of projects to invest in and then they need to get their customers happy and engage with this program so their customers like what they see and are happy about continuing to work with this company. And so all three of these groups need to work together. And how do we usually do that? We usually we delegate to the experts somehow, right? And this is how corporate sustainability programs are run. This is how hedge funds are run. Heck, this is how countries are run. You find a group of experts and you say, we trust you to do this subject to these guidelines and then you let them go do it. And what tends to happen? Well, low levels of engagement from the general public. We don't really know what those people are doing and we're not really sure that we trust it. And on the flip side, also low innovation in that once you've written the guidelines of what the experts are supposed to do, they will follow those guidelines and they'll try to do it well. But if better ways emerge to do it, they're not going to change because well, those are the guidelines, those are my rules. So after a while, you have this thing that's sort of stuck in some way of doing things that the general public is not engaged in, maybe doesn't even trust and then the sponsors and company starts to wonder, is this really worth it? Am I really doing the right thing by spending all this money to do something that my customers don't really believe in or trust? So another way that we've tried, starting about 10 years ago, as we said, let's just open this up to everybody. Hey, let's take a poll on Reddit or Twitter about what kind of actions we should take. And unfortunately what you saw was, let's just say very low quality interactions which eventually cost a lack of results. But with the blockchain, there's actually a third way to do it, that's fundamentally better. And it's called a DAO or Distributed Autonomous Organization. So this takes three properties of the blockchain, proven identities, immutable records and smart contracts. So we could have real people cast real votes that are then immutably recorded so nobody can tamper with them. And then we could have smart contracts automatically be programmed to execute the votes based on the decision of the people take actual action. And the combination allows a more trusted and also seamless way to manage collaboration. So here's an idea for how to make collaboration better with climate action. Let's say we go back to the example and the sponsor is this company and it will give out reputation tokens to its customers and also to a group of experts. And everybody can vote on these reputation tokens using these reputation tokens on a different climate projects that are to be undertaken. So each time you vote, you're staking your tokens so that if the proposal goes against you, you would actually lose the tokens that you've staked. And every time that you vote, the sponsor will pay you based on the number of reputation tokens you've staked. And it's regardless of the outcome of the vote, you will get paid based on how much you've voted. For the sponsor, actually, this is a reasonable proposition because instead of paying an expert panel to make decisions on what climate actions to take, they could just pay people to participate in these dynamically forming sort of panels and votes on climate action. We could use something called quadratic voting to make the voting more tailored to people's preferences rather than just giving everybody one vote. And also we could make the voting anonymous so that people are actually voting on issues rather than voting on people. And then we could give everybody three choices. Do you accept this proposal? Meaning you think it's valid and you would like it to go forward? You could decline the proposal meaning, hey, I think this is a good project but I just don't like it and I don't want this to go forward. Or you could actually vote to reject it which means that you're actually saying this is not a legitimate climate action project. It does not actually work in terms of reducing greenhouse gas emissions. And with a twist that whoever votes for rejected proposal will actually lose their tokens so that over time, the voters that can reject experts and their expertise and basically cause a shift of people who are considered experts in the group if they actually see that the experts are recommending projects that are invalid and not credible. So this is just one set of ideas and we're going to develop it further in an open source way as I'll talk about at the end. So why does this need to be open source and how does open source make this better? Well, first of all, it all is open source. I just want to point that out. Hyperledger's open source, Ethereum's open source and all the code that we're writing already is open source and we'll work with each other through open source methods. More importantly, it needs to be open source because open source means transparency and transparency is required for trust here. We've had a lot of cases where companies have said certain things and either not follow through with it or those things actually didn't work as expected and people have come to this point where they're not sure if they could trust more statements of climate action from companies and that's bad because we all need to work together if this is going to work. So open source is a way to give transparency to everything, to the data, to the calculation methodologies, to the software so that we could all build trust again. Another important thing about why it has to be open source is that climate change is a global problem. It's happening everywhere but it requires local solutions. In every place, the right solution may be different. Here in the United States, basically the emissions come from a lot of energy used to heat and cool buildings and driving around and transporting things and people. So a lot of the solutions actually come from renewable energy and substituting fossil fuel energy for renewable energy. There are other countries that are agricultural and so a lot of their emissions come from land use from cattle grazing and their solutions are going to have to do with land use, with forestry and with grazing methods but the same approach of open source could be used. They just need to be adapted locally and it could be done by the people there rather than waiting for some big beautiful commercial software to come along and solve the problem for everybody. And finally, I think this is really important is that the bottoms up innovative approach works. We've seen with Ethereum, we've seen with Bitcoin and we've seen really with the web browser dating back all those years. These were all things that came out not out of the biggest tech companies at the time but from practically nowhere and yet they've revolutionized the world and we need that kind of innovation for climate change. So here's our little roadmap. We're working on the utility emissions calculations and also on tokenizing renewable energy certificates and offsets and by combining these two we actually have a minimum viable product and we want to deploy this to basically create an open source climate action network so that we could literally be to say proverbially eating our own dog food. We'll be using this to offset our own emissions and we'll welcome other open source developers to join us as well. We're also gonna be expanding on the idea of creating a DAO or DAO for making decisions on climate action. And finally, we're gonna expand this to new channels of data. One of the key ones is transportation. Transportation is really interesting because we have electric vehicles and they could do a lot to reduce emissions. So the question is where's the energy for the electric vehicle coming from? Is it coming from renewable energy like solar panels during the day or is it coming from natural gas or coal plants at night which actually does not help to reduce emissions? And so that needs to be accounted for property and plus there's the question of what is the carbon cost of building a car versus the emissions reduction from driving an electric vehicle versus an older gasoline powered one? So those are really interesting things that we could use the blockchain to solve. And so in the end there's a couple of things that you could do to join us. One is the Hyperledger Climate Action and Accounting Special Interest Group. And this is a group of developers from all over the world. We have people from the United States, we have people from UK, we have people from India, from South Africa and we're all developers getting together to talk about how blockchain could be used to solve the climate problem. And we focus on pretty technical issues like token taxonomies, chain code and deploying blockchain networks and REST interfaces and so on. And another thing that's happening in the middle of November is the Open Climate Collaboration. And this is a much broader group that's going to focus on everything from consumer disclosures to Paris Agreement to mitigation and adaptation to forestry. There's people talking about using IoT, machine learning and everybody from investment bankers to high school students to open source developers. Basically it's anything open source and climate related where we can work together. So please join this if you could. And here are some links to the Climate SIG, to Open Climate Collaborathon, to Hyperledger and to OpenTaps, the software that we built for utility emissions. So we hope to see you working on some of these together. Thank you.