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September 25, 2015Sacramento, CA
Zhang XiaoguangSinocarbon Innovation & Investment Co.,Ltd.
CONNECTIVITY CHOICES FOR REGISTRYWORKSHOP “BUILDING REGISTRIES TO SUPPORT THE NEXT GENERATION OF CARBON MARKETS”
PARTNERSHIP FOR MARKET READINESS
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Systems to be connected to a registry
Connectivity architecture choices
Connectivity protocol choices
Security measures
Outline
3
Potential systems
Trading System
Emissions
Report SystemRegistry
System
Other Registry
Systems
Information source systems
Identity System
Auction
platform
Third party platforms
4
Objectives of connecting systems
• Perform cross market transactions
• ReconciliationsRegistries
• Perform cross platform carbon unit transfer transactions
• Reconciliations
Third party
platforms
• Achieve information from information source systemsInformation
source systems
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Systems to be connected to a registry
Connectivity architecture choices
Connectivity protocol choices
Security measures
Outline
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Central hub based online connectivity
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Peer to peer based connectivity
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Offline connectivity
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Comparison of connectivity architectures
Central Hub Peer to peer Offline
Implementation
complexity
High implementation complexity.
Depends on the transaction rules
to be implemented.
Relatively low for implementing
unified market rules.
High implementation complexity.
Depends on the transaction rules to
be implemented.
Relatively low for implementing
multiple rules.
Low implementation
complexity.
Performance
Capable of processing automated
transactions.
Relatively low performance due to
central hub bottle neck.
Capable of processing automated
transactions.
Relatively high performance due to
peer to peer processing.
Not Capable of
processing automated
transactions.
Low performance due
to offline processing.
Reliability
Central hub failure will affect all
the connected systems.
Easy to ensure the reliability after
updating central hub.
Single peer failure will not affect the
connected systems seriously.
Difficult to ensure reliability after
updating one peer.
High reliability.
Security Easy to apply unified security measures.Difficult to apply unified security
measures.
Vulnerable to information
stealth.
Maintenance cost
Relatively low maintenance cost
for connecting a large number of
systems using single market rules.
High maintenance cost for
connecting a small number of
systems.
Depends on the connectivity of each peer. Low maintenance cost.
Data consistency
Easy to ensure data consistency
with central hub based transaction
log.
Easy to ensure the unified
transaction check rules.
Difficult to ensure data consistency
among peers.
Difficult to ensure the unified
transaction check rules without
erros.
Difficult to react to data
changes of a connected
system.
10
Implementation technologies
Socket level technology Webservice based technology
Implementation
complexityHigh Low
Performance High Low
Reliability Difficult to ensure reliability. Easy to ensure reliability.
Maintenance cost High Low
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Systems to be connected to a registry
Connectivity architecture choices
Connectivity protocol choices
Security measures
Outline
12
Connecting registries- principles
Specify the transactions.
Specify accounting models and transaction workflows.
Specify the carbon units involved.
Specify the transaction check rules.
Specify connection architecture.
Specify data package formats.
Specify data connection available rules.
Specify security rules.
Specify data transmission technology.
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Connecting registries- Brief review of DES
Available for processing most of the transactions in a carbon
market.
Unified accounting model and transaction workflows.
Support Kyoto units, and EUA.
Unified the transaction check rules.
Central hub based protocol.
Unified data package formats. (Serial number identifiers)
7X24 availability.
Unified security requirements.
SOAP based data transmission.
14
Connecting registries- Peer to peer protocol with mirroring approach
Carbon unit cache account
Holding account
Holding account
System 1
System 2
Carbon unit information
Data exchange
interface
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Connecting registries- Reconciliation
Validate account totals.
Validate carbon unit blocks.
Review transaction history logs.
Manual intervention.
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Connecting third party platforms
Mirroring approach can be applied.
Total validation level reconciliation.
Total records be determined by the registry.
Webservice based technology is applicable.
Offline approach can be applied.
17
Connecting information source systems
Specify information synchronization cycle.
Specify information synchronization workflow.
Specify data package format.
Specify data update reaction scheme.
Websevice based technology can be applied.
Offline approach can be applied.
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Systems to be connected to a registry
Connectivity architecture choices
Connectivity protocol choices
Security measures
Outline
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Connection risks
• Data leakage
• Data tempering
• Data inconsistency
• Data loss
• Fraudulent transmission
Online approach
• Data leakage
• Data inconsistency
Offline approach
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security measures
• Reliable workflow design
• Data encryption scheme
• Reconciliation
• VPN connection
• Point to point connection
• IP and port access constraint
• Dedicated connection sever
• Other network security devices
Online approach
• File encryption
• Data change react scheme
Offline approach
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Zhang Xiaoguang
Sinocarbon Innovation & Investment Co.,Ltd.
For more information on the Partnership for Market Readiness, please contact:
WWW.THEPMR.ORG
Thank You for Your Attention
