Corporations increasingly consider sustainability as an important goal and set net zero carbon emissions targets, consequently looking towards their electricity procurement to achieve them. Guarantees of Origin (GOs) are widely used as insurances for the renewability of electricity supplies and proofs of compliance to renewable standards; however, they suffer from structural problems. Their transactional history cannot distinguish between those traded among market actors and the ones that come directly from power plants, giving rise to transparency issues. Certificate trading dissuades producers from investing in an increase in renewable capacity resulting in lack of additionality while complex frameworks and administrative structures emerge to keep track of the vast network of GOs. These issues can be resolved through the introduction of blockchain networks which can provide transparency and help incentivise renewable investment while increasing automation and process simplification. This review explores the benefits and challenges of blockchain implementation for GOs and proposes a rethinking of how this scheme may fulfil the future needs of the energy sector.
Bitcoin critics have argued that energy-intensive Bitcoin production and adoption will exacerbate global warming. Conversely, Bitcoin advocates have been dismayed by criticsâ apparent lack of willingness to scrutinize Bitcoinâs potential role in helping to improve the economics of renewable energy investments, reduce net emissions from methane venting and flaring, increase electricity grid efficiency, and provide higher-order environmental, social, and governance (ESG) benefits. Given the disparate views, there is a pressing need to identify key knowledge needs regarding Bitcoinâs net energy use, carbon emissions, and direct and indirect ESG impacts. I used a variation on the âkey questionsâ horizon scanning approach to identify 100 questions that, if answered, could help provide credible evidence to support policymakersâ, investorsâ, and research fundersâ decision-making on issues relating to the impact of Bitcoin production and adoption. The questions are distributed across 13 themes (ranging from energy use to social impacts). The breadth of knowledge required to answer key questions highlights the need to build research capacity, encourage collaborative cross-sectoral and -disciplinary research, and develop a prioritized research agenda. Defensible evidence for investors, regulators, and policymakers needs to consider Bitcoinâs complex net impacts on energy use and environmental, social, and governance benefits.
The research and investment community seems to ignore the long-term sustainability of Bitcoin, which is reflected in four flaws: transaction fees, miners' revenue, concentration and electricity consumption. While most of the authors have aimed to examine one topic at a time, with a particular interest in electricity consumption and carbon footprint, the aim of this paper is to examine all these issues simultaneously to provide a more comprehensive view on long-term sustainability of Bitcoin. This paper looks at these flaws and reveals why Bitcoin is not sustainable in the long run, how decentralization is being lost, how the design is putting artificial and unrealistic pressure on the ecosystem, while all being powered by an unjustifiable amount of dirty electricity sources. Our main findings are as follows. Firstly, transaction fees are already high and set to increase in time, further discriminating small transactions against big ones. Secondly, miners' revenue comes mostly from the block reward. The block reward is the main income source for miners, but is set to be cut on a regular basis, making miners' revenue not sustainable in the long run. Thirdly, miner concentration is already an issue, with a possibility of deepening even more and diminishing the idea of decentralization. Fourthly, the high electricity demand and the associated carbon footprint thus cannot be justified by any means. We deem our results useful for overall policy and regulatory implications.
Wenshuai Ma, Junjie Hu, Yao Li, Zhuoming Fu ¡ 6 authors
Abstract With global concerns about carbon emissions, the proportion of renewable energy generation worldwide is increasing, and the demand for flexible resources in power systems is growing. In recent years, as a clean means of transportation, the number of electric vehicles has increased, and the optimal scheduling of electric vehicles has become a research hotspot. The rise of artificial intelligence, blockchain, and other innovative technologies has enriched research on optimal scheduling of electric vehicles. To reveal the latest developments in electric vehicle optimal scheduling studies, this paper summarises the application of stateâofâtheâart technologies, including deep learning, deep reinforcement learning, and blockchain technology in the optimal scheduling of electric vehicles. Moreover, the advantages and disadvantages of various technical applications are highlighted. Finally, considering the shortcomings and developmental status of applications of the above three technologies, some suggestions for future research directions are proposed.
The COVID-19 pandemic poses a serious threat to investors in the crude oil market. Furthermore, investors have an increasing need to find a safe haven in their investment portfolios when facing unprecedented risks in crude oil markets during the COVID-19 pandemic. According to a review of the literature, there are contradictory findings on which investment is the safer haven for the oil market. Therefore, this paper aims to evaluate whether bitcoin is a safer haven for the crude oil market than the commonly used gold during the COVID-19 pandemic. Three spillover measurements based on the time, and frequency domains, and a network framework are employed to quantify the return spillover effects among bitcoin, gold and three major crude oil futures markets. We divide the sample into two periods, pre-COVID-19 and post-COVID-19. The results show that bitcoin has a weak safe-haven effect on the crude oil market only over a short period, while gold maintains a good safe-haven ability for crude oil futures across various time horizons (frequencies), both before and after the outbreak of the COVID-19 pandemic. The findings of this study have important implications for policy-makers, crude oil producers and global investors. In particularly, investors cannot ignore the importance of bitcoin and gold in selecting more profitable portfolio policies when searching for safe-haven assets.
Anna BorkovcovĂĄ, Miloslava ÄernĂĄ, Marcela SokolovĂĄ
The article provides an overview of academic contributions to blockchain technology over the past three years. A large number of practical implementations are proving the versatility of blockchain across industries. Some of these areas are easy to deduce, but for some, the benefits of using blockchain technology may not be obvious. Real applications of blockchain can be found in sectors such as cyber security and the financial sector, but also in various categories of the public sector, healthcare, and industry. This paper focuses on the use of blockchain technology in the energy industry. The paper aims to present the current trends of blockchain in the energy sector and provide a summary of blockchain technology discussed in academia. The research questions are formulated to correspond to the basic goals of the energy sector today. The core of the paper forms a systematic review based on the PRISMA guidelines. The output of this systematic review brings an up-to-day insight into the issue and introduces potential areas for further research.
Today, high-tech industries such as consumer electronics commonly face government rules on carbon emissions. Among the rules, carbon emission tax as well as extended producer responsibility (EPR) tax are two important measures. Using blockchain, the policy makers can better determine the carbon target environmental taxation (CTET) policy with accurate information. In this paper, based on the mean-variance framework, we study the values of blockchain for risk-averse high-tech manufacturers who are under the government's CTET policy. To be specific, the government first determines the optimal CTET policy. The high-tech manufacturer then reacts and determines its optimal production quantity. We analytically prove that the CTET policy simply relies on the setting of the optimal EPR tax. Then, in the absence of blockchain, we consider the case in which the government does not know the manufacturer's degree of risk aversion for sure and then derive the expected value of using blockchain for the high-tech manufacturers. We study when it is wise for the high-tech manufacturer and the government to implement blockchain. To check for robustness, we consider in two extended models respectively the situations in which blockchain incurs non-trivial costs as well as having an alternative risk measure. We analytically show that most of the qualitative findings remain valid.
There is a growing interest in understanding the energy and environmental footprint of digital currencies, specifically in cryptocurrencies such as Bitcoin and Ethereum. These cryptocurrencies are operated by a geographically distributed network of computing nodes, making it hard to accurately estimate their energy consumption. Existing studies, both in academia and industry, attempt to model the cryptocurrencies energy consumption often based on a number of assumptions for instance about the hardware in use or geographic distribution of the computing nodes. A number of these studies has already been widely criticized for their design choices and subsequent over or under-estimation of the energy use. In this study, we evaluate the reliability of prior models and estimates by leveraging existing scientific literature from fields cognizant of blockchain such as social energy sciences and information systems. We first design a quality assessment framework based on existing research, we then conduct a systematic literature review examining scientific and non-academic literature demonstrating common issues and potential avenues of addressing these issues. Our goal with this article is to to advance the field by promoting scientific rigor in studies focusing on Blockchain's energy footprint. To that end, we provide a novel set of codes of conduct for the five most widely used research methodologies: quantitative energy modeling, literature reviews, data analysis \& statistics, case studies, and experiments. We envision that these codes of conduct would assist in standardizing the design and assessment of studies focusing on blockchain-based systems' energy and environmental footprint.
With the control of the cryptocurrency market in environmental protection, investors pay attention to the risk conduction mechanism between energy consumption and the Bitcoin market. This paper applies quantile connectedness to analyse the overall situation and dynamic evolution of information spillover in the system of the Bitcoin market. The results show that the hashrate and electricity demand are the primary sources of risk in the information network, and their fluctuations have intensified the risk spillover effects in the system. In addition, the spillover level is more prominent in extreme cases, which means the information linkage in the system is integrated. The spillover effect of each variable fluctuates and is uncertain with time. This helps in the sustainable development of Bitcoin and guides the government's policy development and supervision of cryptocurrencies. The risk infection path helps prevent the risk of infection in the Bitcoin market and improves the sustainability of the encrypted market.
Florentina Magda Enescu, Fernando Georgel BĂŽrleanu, Maria Simona RaboacÄ, Nicu Bizon ¡ 5 authors
This paper presents a comprehensive review of the technical aspects and challenges in existing public transport services. This review highlights the challenges and solutions for the main subsystems of public transport services, being focused on the influence of public transportation in an urban area with high demographics to identify solutions based on blockchain technology for future development of the current management platforms. More than 2000 research papers, published since 2018 and until now, have been analyzed in Web of Science, Scopus, and ScienceDirect. The keywords used for the analysis of blockchain integration in public transport are related to technology, services, management, the use of electric vehicles, and the impact of public transport on the environment. In this research, we analyzed why there is a need for integrating the blockchain technologies in public transport.
Karen Mould, FĂĄbio Silva, S. Knott, Brian OâRegan
Solar and wind energy technologies, due to their nature of weather dependency, have been recognized as not the complete solution for the renewable energy transition. Creating a solution for the short fall is empirical if we are to remove the dependency on fossil fuels and reach net zero targets. The production of hydrogen, biogas and other gases can be produced sustainably, which can also allow for the utilization of waste materials or the ability to store energy and allow a greater positive impact on our environment. However, production of these gases is not always as transparent or environmentally friendly as perceived, so with the aid of certification and blockchain, we can create a system that can guarantee their environmentally positive origin, and ultimately help assist the transition to a greener future. This paper explores the varying production methods, with consideration to their environmental impact, and the implications of the use of certificates and blockchain to monitor production, trade and usage.
Benjamin A. Jones, Andrew L. Goodkind, Robert P. Berrens
Abstract This paper provides economic estimates of the energy-related climate damages of mining Bitcoin (BTC), the dominant proof-of-work cryptocurrency. We provide three sustainability criteria for signaling when the climate damages may be unsustainable. BTC mining fails all three. We find that for 2016â2021: (i) per coin climate damages from BTC were increasing, rather than decreasing with industry maturation; (ii) during certain time periods, BTC climate damages exceed the price of each coin created; (iii) on average, each $1 in BTC market value created was responsible for $0.35 in global climate damages, which as a share of market value is in the range between beef production and crude oil burned as gasoline, and an order-of-magnitude higher than wind and solar power. Taken together, these results represent a set of sustainability red flags. While proponents have offered BTC as representing âdigital gold,â from a climate damages perspective it operates more like âdigital crudeâ.
In this paper we analyze dynamic demand elasticity for Bitcoin and Ethereum in terms of price, transaction fees, and energy usage. We find that while both BTC and ETH have significantly positive price elasticities, transaction fee elasticity is negative and positive for BTC and ETH respectively, indicating differences in potential uses for these cryptocurrencies.
Tehreem Ashfaq, Muhammad Irfan Khalid, Gauhar Ali, Mohammad El Affendi ¡ 10 authors
In this paper, a secure energy trading mechanism based on blockchain technology is proposed. The proposed model deals with energy trading problems such as insecure energy trading and inefficient charging mechanisms for electric vehicles (EVs) in a vehicular energy network (VEN). EVs face two major problems: finding an optimal charging station and calculating the exact amount of energy required to reach the selected charging station. Moreover, in traditional trading approaches, centralized parties are involved in energy trading, which leads to various issues such as increased computational cost, increased computational delay, data tempering and a single point of failure. Furthermore, EVs face various energy challenges, such as imbalanced load supply and fluctuations in voltage level. Therefore, a demand-response (DR) pricing strategy enables EV users to flatten load curves and efficiently adjust electricity usage. In this work, communication between EVs and aggregators is efficiently performed through blockchain. Moreover, a branching concept is involved in the proposed system, which divides EV data into two different branches: a Fraud Chain (F-chain) and an Integrity Chain (I-chain). The proposed branching mechanism helps solve the storage problem and reduces computational time. Moreover, an attacker model is designed to check the robustness of the proposed system against double-spending and replay attacks. Security analysis of the proposed smart contract is also given in this paper. Simulation results show that the proposed work efficiently reduces the charging cost and time in a VEN.
Recently, Digital money is booming, and bitcoin shows potential in the field of investment as a representative of digital currency. According to modern portfolio theory, most of the investors are absolute risk-averter, and a diversified portfolio can effectively reduce the risk. So investors usually combine bitcoin with other assets to reduce non-systemic risks. Therefore, it is of great importance to formulate a feasible portfolio that can make steady returns for investors. For this reason, we build models to find suitable strategy to quantify the proportion of assets invested so that investors can make optimal investment decisions. We measure the return, risk, and efficiency of risk modelâs portfolio by sharpe ratio. And based on DEA method, the multi-stage portfolio with V-type transaction cost is evaluated by comparing the portfolio from risk model with the portfolio by applying DEA method, and finally we prove that the strategy is the optimal one. Finally, the advantages and disadvantages of this model are analyzed and summarized.
Laura Cirrincione, Maria La Gennusa, Giorgia Peri, Gianfranco Rizzo ¡ 5 authors
Decarbonizing urban environments and reducing their energy consumption is one of modern society biggest commitments. In this regard, both the scientific community and international governments have been giving special consideration on improving the energy-environmental performance of mostly single buildings; recently the focus has been shifting towards a broader Positive Energy District (PED)/ Energy Community (EC) vision, from small clustered group of buildings to neighborhoods up until urban settlements. In this respect, integrating the use of renewable energy resources (RES) and actively involving building users can have a significant environmental impact on local areas. Within this framework, this work discusses the possibility of employing an innovative blockchain-based approach for the energy interaction among buildings. The blockchain technology can, in fact, be useful in managing such scenarios since it would allow to, not only consider buildings occupants behaviors, but also take into account concernings regarding the need for transparency, engagement, environmental and human health benefits, as well as the stakeholders role in the interaction/integration between PEDs/ECs and local/national electricity systems.
Cemal Zehir, Melike Zehir, Alex Borodin, Z. F. Mamedov ¡ 5 authors
Blockchain technology has emerging areas of deployment in diverse sectors and use cases. In this study, several potential application areas of blockchain with promising benefits have been identified in the natural gas industry. There is no single solution that can address different challenges and meet disparate requirements. Therefore, it is important to understand the needs of the natural gas industry and propose appropriate blockchain solutions. Moreover, in the literature, there is a lack of detailed case studies involving industrial experts from the natural gas sector. Expert opinion can be useful for prioritizing the most needed or expected blockchain application areas among several options. By considering privacy, authentication, speed, security, energy consumption, and costs, suitable blockchain types and consensus mechanisms can be determined. This study presents one of the first detailed case studies for tailored applications of blockchain in the natural gas industry. Through a two-staged semi-structured interview with executives from SOCAR Azerbaijan, the most important blockchain application areas and operational requirements were identified. Furthermore, the most suitable blockchain solutions that can address application-specific conditions and needs were determined. This study both, develops a replicable and reliable methodology to conduct detailed blockchain implementation case studies in the natural gas industry and various other sectors, and provides detailed insights into the primary application areas, operational expectationsârequirements, and implementation challenges specific to each application.
To achieve the goal of carbon neutrality, many countries have established regional carbon emission trading markets and tried to build a low-carbon economic system. At present, the implementation of carbon emission trading and low-carbon economic systems faces many challenges such as manipulation, corruption, opacity, lack of trust, and lack of data tracking means. The application of blockchain technology can perfectly solve the above problems. However, the data recorded on a blockchain are often multi-type and heterogeneous, and users at different levels such as regulators, enterprises, and consumers have different requirements for data types and granularity. This requires a quick and trustworthy method for monitoring the carbon footprint of enterprises and products. In this paper, the carbon footprint traceability of enterprises and products is taken as an application scenario, and the distributed traceability concept of "traceability off the chain and verification on the chain" is adopted. By reconstructing the pointer of the file structure of the distributed storage, an interactive traceability structure supporting type filtering is constructed, which enables fast retrieval and locating of carbon emission data in the mixed data on the chain. The experimental results show that using the interactive traceability structure that supports type filtering for traceability not only releases the computing power of full nodes but also greatly improves the traceability efficiency of the long-span transaction chain. The proposed carbon footprint traceability system can rapidly trace and track data on an enterprise's and a product's carbon footprint, as well as meet the needs of users at all levels for traceability. It also offers more advantages when handling large amounts of data requests.
Moritz Platt, Stephen Ojeka, Andreea-Elena DrÄgnoiu, Oserere Ejemen Ibelegbu ¡ 7 authors
Abstract Decentralized cryptocurrency networks, notably those with high energy demand, have faced significant criticism and subsequent regulatory scrutiny. Despite these concerns, policy interventions targeting cryptocurrency operations in the pursuit of sustainability have largely been ineffective. Some were abandoned for fear of jeopardizing innovation, whereas others failed due to the highly globalized nature of blockchain systems. In search of a more effective angle for energy policy measures, this study adopts a consumer-centric perspective, examining the sentiments of Nigerian cryptocurrency users ($n=158$) toward Bitcoinâs sustainability, a representative cryptocurrency known for its high electricity demand. Three main findings emerged: 1) Even among those self-identifying as highly knowledgeable, most considerably underestimated Bitcoinâs electricity consumption. 2) Participants with a more accurate understanding of Bitcoinâs energy demand were more inclined to support sustainability measures. 3) Most of this supportive cohort viewed private entities as the primary stakeholders for implementing such measures. Given these findings, we suggest that consumer education should be at the forefront of policy initiatives aimed at cryptocurrency sustainability.
Uyikumhe Damisa, Peter Olabisi Oluseyi, Nnamdi Nwulu
Inadequate gas supply is partly responsible for the energy shortfall experienced in some energy-poor nations. Favorable market conditions would boost investment in the gas supply sector; hence, we propose a blockchain-based fair, transparent, and secure gas trading scheme that facilitates peer-to-peer trading of gas. The scheme is developed using an Ethereum-based smart contract that receives offers from gas suppliers and bid(s) from the thermal plant operator. Giving priority to the cheapest offers, the smart contract determines the winning suppliers. This paper also proposes an economic dispatch model for gas-deficient plants. Conventional economic dispatch seeks to satisfy electric load demand whilst minimizing the total gas cost of generating units. Implicit in its formulation is the assumption that gas supply to generating units is sufficient to satisfy available demand. In energy poor nations, this is hardly the case as there is often inadequate gas supply and conventional economic dispatch is of little practical value. The proposed economic dispatch modelâs objective function maximizes the quantity of available gas and determines the optimal power output of each generating unit. The mathematical formulation is verified using data from the Egbin thermal station which is the largest thermal station in Nigeria and is solved using the General Algebraic Modeling System (GAMS). Obtained results indicate the viability of the novel approach as it results in a net power gain of 35 MW. On the other hand, the smart contract proved effective in accurately selecting winning suppliers and making payment.
Adam Sipthorpe, Sabine Brink, Tyler Van Leeuwen, Iain Staffell
Carbon markets could hasten climate change mitigation by driving investment towards efficient decarbonization activities, but they face problems around trust, transparency, and uptake. Blockchain offers a foundational technology upon which new carbon markets can be built which address these shortcomings. This sector is still nascent, fragmented, and clouded by technology hype, all of which obscures objective judgement of its performance and suitability. Here, we survey the current blockchain ecosystem, identifying 39 organizations that are developing blockchain solutions for carbon markets across four use cases: emissions-trading schemes, voluntary carbon markets, Article 6 of the Paris Agreement, and the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). We develop and apply a technology readiness level (TRL) scale, and we find that most projects are still proofs of concept (TRL ⤠3); however, one system has now reached maturity (TRL 9). Addressing the common barriers that face developers could allow more blockchain solutions to mature and potentially facilitate globalized carbon markets with greater efficiency, transparency, and accessibility.
It is possible to define uncertainty as the variability of conditions, the ambiguity and obscurity of statements and events. Uncertainty, for whatever reason, affects the economy in different ways. Uncertainty causes people to be more concerned about their future income. Various estimation and methods have been developed in recent years to calculate the uncertainty, which is equivalent to the concept of uncertainty. These indices, in which economic and political uncertainties are calculated, appear as a form of calculation that also includes political discourses along with financial risk. The aim of this study is to examine the causality relationship between the Global economic political uncertainty index and Bitcoin electricity consumption. For this purpose, the Toda-Yamamoto causality test was applied using data from the period 2011:M7-2022:M1. According to the obtained Toda-Yamamoto causality test findings, Granger causality relationship has been determined both from the global economic-political uncertainty index to Bitcoin electricity consumption and from Bitcoin electricity consumption to the global economic-political uncertainty index.
The dynamic nature of competitive electricity markets means that participants often resort to some form of derivative financial instrument. One such instrument is a contract-for-difference (CFD), usually available to renewable generators in certain electricity markets to enable them to hedge their price risk. Embracing CFD presents new risks such as counterparty credit, margining, third-party, legal, and process risks. Derivative instruments existing on blockchains have recently demonstrated potential as suitable hedging tools for minimizing the risks of renewable generators. This article applies this concept for the first time to hedge the price risk of renewable generators by implementing a novel decentralized finance instrument, an Ethereum blockchain marketplace governed by a smart contract to mediate between stakeholders mutually enrolled in bilateral CFD arrangements. The employed structure mitigates the underlying risks of traditional arrangements, underpinned by a suite of autonomous mechanisms.