Application of Blockchain Technology in Incentivizing Efficient Use of Rural Wastes: A case study on Yitong System.

Abstract Rural areas in developing countries have constantly been plagued by poor sanitation and energy shortages. A key issue has been the decentralized nature of waste generation and energy consumption, leading to farmers burning crop stocks, lumber, and other agricultural waste. As 1.9 billion people lack access to waste collection services [1], untreated solid and liquid refuse hamper the health of many and irreversibly damage the local ecosystem. Considering the scattered nature of agricultural waste generation and centralized treatment difficulties, this study examines the feasibility of adopting decentralized blockchain system in trading biomass energy and agricultural products across the waste-to-energy ecosystem. A case study is conducted based on the Yitong system in Changzhi City, Shanxi Province, China. This plant collects and transports agricultural wastes (crop straw and animal residue), and converts them to clean energy and agricultural by-products like briquettes, fertilizer, and animal feedstock. This paper presents how a digital coupon or cryptocurrency can be introduced to trade the wastes, energy and by-products among the farmers and entrepreneurs. It argues that this system could maximize the use of agriculture wastes by incentivizing farmers and enterprises to work together. This paper covers three key areas: 1) Literature review, methodology preparation, and field assessment for introducing digital incentive mechanism to enhance rural wastes management. 2) Design of a prototype of blockchain-based model: (a) how the waste-to-energy plant managers collect the segregated waste from individual farmers through trucks connected to blockchain-based smart meters; (b) how systems on each of the trucks register the quantity of waste received onto a universal ledger when collecting. This quantity received will be translated into a certain amount of energy and products like fertilizer that the waste-to-energy plant owes each farm; and (c) how the farmers will receive digital coupons corresponding to the quantity of energy and agricultural products that they should receive. 3) Evaluation of the feasibility of blockchain-based model (technical and economic): (a) data collection on the total quantity of waste produced and the processing capabilities and availability of Waste to Energy plants; (b) assessing readiness of digital infrastructure (cyber-security and communications); and (c) economic evaluation of the incentives and responsibilities associated with the key stakeholders from the farmers to enterprises. [ABSTRACT FROM AUTHOR]