Blockchain technology and the cryptocurrencies that use it are growing at a furious pace. The idea of a distributed ledger that records the consensus of a community of users about transactions in an unchangeable (“immutable”) form turns out to have many applications, including the possibility of replacing the overgrown finance industry with something lighter and more people-centred. Cardano grew several thousand percent in 2021; Bitcoin grew several hundred percent; etc.

This growth has had some negative consequences: the proof of work mechanism for consensus that is used by Bitcoin, Ethereum Classic and others drives an arms race of coin miners who buy more and more specialised computers and use more and more energy. Cardano uses proof of stake instead, and users delegate their coins to trusted infrastructure providers to achieve consensus. This makes Cardano (and other proof of stake chains) very low energy: perhaps using >10000x less energy!

Take these two facts together (the huge growth of Cardano plus the low energy needed) and we have the possibility of the whole blockchain and the ADA currency becoming climate positive. In other words, we can achieve carbon decentralised finance, and then go further to start drawing down greenhouse gasses and starting the long hard struggle to global cooling.

How do we calculate and plan for this process? Read on 🙂

The road to positive: neutralising our carbon emissions

To become climate positive, first we must become carbon neutral. This page describes how we do that for SHIFT, starting with a look at how we footprint our emissions, then some calculations, then finishing with our initial steps.

Definitions of Scope categories for carbon footprinting

How do we measure our footprint?

Scope 1: These are the emissions from sources you own and control and are therefore directly responsible for. For most businesses, this will be any gas heating or fuel oil you burn on-site, and the fuel you use in your company vehicles. If you use industrial refrigeration or air conditioning, refrigerant losses would also be included here, along with any emissions that may be released directly during a manufacturing process.

Scope 2: These are the emissions you indirectly produce through the energy you purchase, which for most businesses is solely electricity. By using electricity, you are indirectly responsible for the greenhouse gases generated at source by the energy producer.

Scope 3: These are any other emissions you’re indirectly responsible for from sources outside your direct control, e.g. the goods and services you purchase, the distribution and use of your own goods and services by customers, the disposal of your waste, employee commuting or business travel, and so on.

What emissions to count? (What is in scope?)

Boundaries can be difficult to assign and since there carbon emissions in nearly everything today expert advise on setting these can be helpful. Reminding ourselves of the categories above helps to not exclude emissions that are definitely linked to running our stake pool.

Scope 1 and 2 emissions are direct and indirect emissions that the pool has influence over and should be included as a minimum in carbon accounting, while scope 3 are emissions that are not in direct control of the pool but should be accounted for if possible.

Scope 1:

Gas heating of two SPO homes and/or offices
Two SPOs sometimes driving an ICE car (though Christian has an electric car 😊)

Scope 2:

Electricity consumption of cloud servers
Electricity consumption of computer equipment at home and/or office

Scope 3:

Embedded carbon in our equipment
Carbon emissions of other Cardano infrastructure
Other indirect emissions

Simplified Carbon Accounting and trees required to offset

To determine an initial realistic carbon footprint of SHIFT Pool, we determined 1) server electricity consumption and added 2) a percentage of the overall carbon footprint for the time and energy spend of its two SHIFT pool operators. Using a percentage of the individual carbon footprint of SPOs covers several emission sources in Scope 1, 2 and 3 categories without the need to measure all emissions individually.

The WWF carbon footprint calculator was used to determine our individual SPO carbon emissions, because it already takes account of several lifestyle factors (detailed in the Scope categories) of the SPOs including country of living, cars, flights, house and type of heating.

The carbon footprint for Christian was 8.8 tonnes per year, and I extrapolated about a similar amount for Hamish and rounded it up to 10 tonnes per year. The average carbon footprint of a UK citizen is a bit lower, but then I would expect our middle class lifestyle to have an impact.

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Here’s the full spreadsheet.

Running cloud servers on 100% renewable energy

Running the Cardano nodes on a cloud server can have advantages in terms of energy use, as well designed data centres offer efficiency gains (as does virtualisation). We additionally chose a service that promises to run on 100% renewable energy to further reduce our impact.

However, as we don’t have exact consumption data and have to trust our provider to indeed run on renewables, our carbon footprinting is done with average numbers for such servers and assuming grid carbon emissions.

Conclusions

The above assessment concluded that planting of 216 trees would fully offset all SHIFT pool carbon emissions. Any further pool actions for the climate would then render it to have a positive influence on the climate.

Worth remembering…

While these numbers will likely fully cover Scope 1 and 2 emissions in our control, we should be aware that

They do not cover all emissions, as embedded carbon or emissions from the waste cycle are not considered
The carbon capture capacity of trees is highly variable and depends on the size, type, the location, the life span etc of the trees planted or protected
Trees can not capture other greenhouse gases such as Methane or CFCs

Any Greenhouse Gas Accounting can only be taken seriously if the methodology as well as boundaries are clearly transparent.

Becoming Climate Positive