Industry is the engine of the world economy, the most powerful force mankind has brought to bear in its brief time on earth. Industry has led to the capability of accomplishing great things, feeding the world, improving quality of life for billions of people, and creating wealth and economic power in a relatively short time. The problem is that energy efficiency and the sustainability of processes used by industry always fell to the back burner in the face of overcoming obstacles. Now the world is beginning to realize that forgoing the incorporation of sustainability into the grand industrial plan has left us with the largest obstacle the world must face.
With smart contracts, sustainability can harness the power of humanity’s industrial endeavors to create an intrinsic value in all its efforts. It’s simple: take the top attribute of industry—its scalability—and make it work in our favor to multiply the effects of sustainable practices. By setting up standards of measure that will be upheld by smart contracts backed by blockchain distributed ledger technology.
Since a smart contract is a transaction protocol or computer program that is intended to document, control, or execute legally relevant actions or events automatically in line with contract terms that result from a negotiation or agreement, setting up contracts using existing sustainability models and formats is relatively simple. And because smart contracts reduce the need to have enforcement costs, arbitrations, and trusted intermediators, it works just like any contract, where a party completes an action when contract terms are met by another party with a great reduction in fraud losses, as well as malicious and accidental exceptions.
Some industries will lend themselves better to this participation, particularly in the early days, and, conveniently, these industries bear the brunt of responsibility for global warming and climate change due to greenhouse gas emissions.
The petroleum industry is considered a likely candidate for an industry needing a solution to expand sustainability practices, reduce its carbon intensity, and track every shift and change. Because of the scale of the industry in terms of its global efforts in drilling and gathering crude material, transporting, refining, and distributing finished liquid transportation fuels, even the smallest moves toward sustainability outlined in smart contracts will begin to show an impact—and a substantial value.
Large-scale agriculture is another possible candidate for improving sustainability and tracking the value impact. Smart contracts can be set up to verify practices and expand programs to incentivize soil carbon and other sustainability measures. The fact is agriculture is something that mankind pursues on an enormous scale, and choosing techniques and methods that increase sustainability will move the dial in a positive direction. Track those programs and it will further increase the value of every acre of land dedicated to agriculture, and change the game.