It’s Earth Day. How Can Ethereum Achieve Carbon Neutrality in the Future?

Unlike many other blockchains, the Ethereum community has been proactive about its carbon footprint by moving to a Proof of Stake model. While this is a necessary step, the ultimate goal needs to be carbon neutrality. The logical solution for long-term scalability in this aspect would be to implement carbon credits into the cost of performing transactions to offset the energy usage needed to process these transactions.

I came across a new project creating a protocol to offset all carbon emissions generated by cryptocurrency transactions. Dovu (https://www.dovu.earth/) allows any other project to use its system to make their network carbon neutral. Ocean Protocol announced this morning they would be partnering with them for this purpose. The project uses Hedera Hashgraph to issue tokenized carbon credits to any carbon emitter to fund carbon-negative activities, such as soil sequestration by farmers. There is a nice write-up on the Hedera website: https://hedera.com/users/dovu.

If this is the route we will take to become carbon neutral, adding a carbon tax to transaction fees would help the most energy efficient networks and could make the least efficient networks too expensive to use. Of course, energy inefficient networks could resist doing anything at all to reduce their carbon footprint. But once we have blockchains that can provably claim to be carbon neutral using something like Dovu, I think the people of the world will make the right choice and transact where they know the environmental impact will be neutralized. Any network that cannot achieve carbon neutrality will be marginalized in favor of ones that can.

With Eth 2.0 expected to cut the network's energy consumption by 99%, we are on a good path. However as we all know we are still extremely early as far as mass adoption, with less than 100,000 unique dApp users each day most days. Even with a 99% drop in energy consumption, as adoption accelerates we will be forced to face the environmental impact of the ETH network. The only way to ensure the long term viability of the network from an environmental perspective is to have a provable method of carbon offset applied to every use of the network.

TLDR: ETH needs to adopt a roadmap to achieve carbon neutrality at some point in the future to remain viable.