CCA showcase: Zumo and Caleb & Brown power crypto holdings with verified renewables for customers
The Crypto Climate Accord (CCA), which launched about six months ago and includes over 250 Supporters and Signatories, is accelerating the development of open-source solutions and good practices to decarbonize the crypto industry. The first CCA showcase, implemented in September, focused on the supply side of the crypto market with an open-source solution to power Filecoin storage providers with renewable power and use proof of green Filecoin mining to boost the respective rank of Filecoin storage providers in the Filecoin Reputation System (FilRep).
Today, U.K. crypto wallet Zumo and Australian crypto brokerage firm Caleb & Brown (C&B) offer the latest showcases, this time focused on the demand side of the crypto market. Both companies now power the energy use associated with their Bitcoin-related activity with renewable energy sources — in the form of digitized energy attribute certificate (EAC) purchases facilitated by search engine Zero equal to the estimated energy use associated with their respective customers’ crypto holdings — and can prove this renewables procurement “on-chain”. Because they do not know what (if any) percentage of their crypto holdings and associated transactions use renewably-powered mining, these showcases provide an example of how crypto wallets, exchanges, applications, investors, and holders can take a leadership role in powering their respective crypto supplies with renewables.
Zumo launched a three month “Zero Hero” pilot for users of renewably-powered Bitcoin wallet
Zumo spearheaded research this summer to investigate methodologies for estimating the energy use associated with the Bitcoin (BTC) on the Zumo wallet as part of its net zero strategy development process. This investigation, which informed RMI’s recently published Guidance for Accounting and Reporting Electricity Use and Carbon Emissions from Cryptocurrency, put two estimation methodologies on the table for Zumo to consider using to decarbonize:
- The “mined since genesis” model, which calculates electricity consumption of BTC’s mining based on the aggregated electricity use since the BTC genesis block available from public data from the Cambridge Bitcoin Electricity Consumption Index (CBECI) and total BTC mined and circulated.
- The “share of the BTC network” model, which calculates the electricity consumption attributable to a given actor (like Zumo) as a share for their use of the BTC network over a defined time period like a year.
Zumo details the findings from its research in its recently published State of Play Report and used these insights to create a company-wide net zero strategy. To kick start the implementation of its net zero strategy, Zumo launched the Zero Hero pilot to match the electricity consumption related to BTC purchases on Zumo with EACs. In other words, Zumo users who purchase BTC during the pilot period will get proof that their BTC’s power consumption is matched with 100% verified renewable energy, where the proof of this renewable energy procurement is anchored on the public Energy Web Chain.
Kirsteen Harrison, Zumo Environmental and Sustainability Adviser, said: “We’re delighted to be able to pilot and share these methodologies with our peers in the industry as a transparent, open source way to advance the decarbonisation discussion. Meaningful progress calls for collective action, making it all the more heartening to see not only the latest commitment from fellow CCA signatory C&B, but also the evolving body of best practice emerging through shared initiatives such as the CCA and RMI.”
Caleb & Brown applied energy estimation methodology and decarbonized crypto holdings for an art gallery
Using the emerging solutions and good practices being developed by the CCA community, C&B took a leadership position among crypto brokerage firms wanting to offer customers verifiable ESG (environmental, social, governance) solutions. C&B applied the “mined since genesis” methodology (one of the models developed by Zumo) to account for and procure the EACs needed to cover the energy use associated with 3 BTCs for the Northern Center for Contemporary Art (NCCA) in Darwin, Australia.
As a result, C&B procured and delivered on-chain proof of the EACs, as found on this verification page, which demonstrates that the energy consumption attributed to the gallery’s BTC holdings is matched with renewable energy sources. With the success of the showcase, C&B are working towards offering their 19,000+ clients the chance to decarbonize their crypto holdings.
“Acknowledging that the industry does contribute to energy consumption and carbon emissions, we feel it is our duty to both Mother Earth, for the resources that fuel our industry and to our clients, to offer them the opportunity to optimise the sustainability of their investments” said Dr. Prash Puspanathan, Co-Founder of Caleb & Brown.
Zumo and C&B showcase an initial roadmap to decarbonize crypto transactions and holdings
Zumo and C&B’s showcases help outline an initial roadmap for how crypto wallets, exchanges, applications, investors, and holders can decarbonize their crypto supplies:
- First, use emerging good industry practices like RMI’s new guidance to estimate the energy use of crypto holdings and/or transactions.
- Second, procure digitized EACs using tools like Zero to give customers proof of sourcing renewables at an amount equal to the estimated electricity use of the crypto supplies.
- Third, use this proof of renewables sourcing for crypto supplies to support more transparent reporting around progress toward sustainability goals.
Zumo and C&B also offer an example of broader sustainability leadership since they are buying renewables to cover the electricity consumption of Bitcoin miners and, as a result, decarbonize their supply chain in a verifiable way for customers.
“It’s great to see companies like Zumo and C&B pursuing crypto-decarbonization,” said Marc Johnson, Sr. Associate at RMI. “We hope our green crypto accounting guidance helps them and many others establish their decarbonization targets.”
Beyond supporting their sustainability goals, both companies also expect near-term business value from a digitized decarbonization solution: enhanced customer retention and new customer acquisition. Zumo’s Zero Hero pilot will contribute valuable insights about the business benefits of guaranteeing and proving use of renewable energy sourcing to crypto platform users.
More and more consumers, investors, and regulators want to verify the environmental credentials of investments, these showcases give a glimpse into the direction the CCA community is heading and the role of decentralized technologies to simplify decarbonization for companies that want proof of green supplies, which in this case means proof of green crypto supplies.
To learn more about opportunities to power crypto mining and holdings with renewables and on-chain green proofs, please contact CCA co-founder Energy Web via CCA@energyweb.org.