Metrics Methadology

Transparent and credible method to calculate the environmental impact metrics for EcoVest. The goal is to translate user investments into tangible outcomes like "CO2 saved," "plastic recycled," or "trees planted." Here’s a step-by-step framework:

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1. Define Impact Categories

Align metrics with your project types:

Project Type	Metric	Example Unit
Renewable Energy	CO2 emissions avoided	Tons of CO2/year
Recycling	Plastic/ocean waste recycled	Kilograms (kg)
Reforestation	Trees planted	Number of trees
Emission Control Tech	Air pollutants reduced	Tons of SO2/NOx avoided

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2. Gather Data Sources

Use industry-standard references to assign values to each project:

• Renewable Energy:

  • Example: 1 MWh of solar energy avoids ~0.5–0.7 tons of CO2 (EPA).

  • Formula:

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    CO2 saved = (Energy produced by project in MWh) × (Local grid’s CO2 intensity - Project’s CO2 intensity)  

• Recycling:

  • Example: Recycling 1 ton of plastic avoids ~1.5–2 tons of CO2 (WasteAid).

• Reforestation:

  • Example: 1 tree sequesters ~21 kg CO2/year (One Tree Planted).

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3. Create a Standardized Formula

For each project, calculate impact per dollar invested:

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Impact per dollar = (Total project impact) / (Total project cost)  

Example: Solar Farm Project

• Project Cost: $100,000

• Annual Energy Output: 200 MWh

• CO2 Avoided: 200 MWh × 0.6 tons/MWh = 120 tons CO2/year

• Impact per Dollar: 120 tons / 100,000=0.0012tonsCO2per100,000=0.0012tonsCO2per1

If a user invests $500:

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User impact = $500 × 0.0012 = 0.6 tons CO2/year (or 600 kg)  

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4. Implement Dynamic Tracking

• Backend Logic:

  • Store impact_per_dollar for each project in your database.

  • When a user invests, calculate their share:

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    -- Example SQL query to calculate CO2 saved  
    SELECT 
      t.user_id, 
      SUM(t.amount * p.impact_per_dollar) AS total_co2_saved  
    FROM transactions t  
    JOIN projects p ON t.project_id = p.id  
    GROUP BY t.user_id;  

• Frontend Display:

  • Convert metrics to relatable equivalents (e.g., "600 kg CO2 ≈ 15,000 miles driven by a car").

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5. Handle Time-Based Impacts

Some projects (e.g., trees) have impacts that grow over time. Use annualized metrics:

• Reforestation Example:

  • If a tree sequesters 21 kg CO2/year, a $50 investment (plants 10 trees) would show:

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    Year 1: 10 trees × 21 kg = 210 kg CO2  
    Year 5: 10 trees × 21 kg × 5 = 1,050 kg CO2  

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6. Ensure Transparency

• Public Methodology Page:

  • Explain formulas, data sources, and assumptions (e.g., "CO2 values based on EPA’s 2023 averages").

• Third-Party Verification:

  • Partner with auditors like Verra or Gold Standard to certify high-impact projects.

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7. Example Calculation Flow

Project: Ocean Plastic Recycling in Indonesia

• Total Cost: $50,000

• Plastic Recycled: 100,000 kg

• Impact per Dollar: 100,000 kg / 50,000=2kgper50,000=2kgper1

• User Investment: $200

• User Impact: $200 × 2 kg = 400 kg plastic recycled

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Tools & APIs to Simplify This

1. Carbon Calculators:

   • Cloverly API: Real-time carbon offset calculations.

   • Patch API: For scalable carbon accounting.

2. Open Data Sources:

   • EPA Emission Factors

   • World Bank Climate Data

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Edge Cases to Consider

1. Project Failure: What if a solar farm shuts down after 1 year? Refund users or redirect funds.

2. Geographic Variability: Adjust CO2 savings based on local energy grids (e.g., coal-heavy vs. renewable-heavy regions).

3. Inflation: Recalculate impact_per_dollar if project costs change mid-funding.

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Final Output for Users

Display impact in a simple, visual dashboard:

"Your $500 investment in [Solar Farm X] will save 600 kg CO2/year — equivalent to 15,000 miles not driven! 🌱"

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By grounding your metrics in credible data and making calculations transparent, EcoVest can build trust and stand out in the green fintech space.