Grounding the Genuine Progress Indicator in Exergy: A First-Principles Physical Accounting Framework for Local and Macro-Scale Systems

Policy Brief & Technical Addendum prepared in direct response to the Ministry of Environment, Solid Waste Management and Climate Change Article 6 Carbon Market Framework Consultations launched in Port Louis, Mauritius (September 22, 2026), in collaboration with the Institut de la Francophonie pour le Développement Durable (IFDD) and the Organisation Internationale de la Francophonie (OIF).

Abstract: Contemporary net-zero accounting frameworks—including mandatory disclosure ledgers implemented by major G7 industrial powers—suffer from a structural thermodynamic flaw: they treat avoided emissions and paper offsets as equivalent to physical removals. This paper deconstructs the Exergy Asymmetry of the Global Carbon Cycle, exposing how large industrial economies utilize high-exergy infrastructure (Direct Air Capture, thermochemical synthesis, power grids) to convert CO2 into high-value synthetic commodities, while Small Island Developing States (SIDS) are relegated to selling passive, low-cost nature-based offsets.

By selling their carbon credits, SIDS legally bind their local terrestrial and marine substrates to neutralize foreign emissions while remaining exposed to physical climate damage (ocean acidification, thermal stress, coastal erosion). To eliminate this "pay-to-pollute" trap, we establish a Thermodynamically Bound Genuine Progress Indicator (GPI_net). We replace volatile market credit pricing with an explicit Physical Restoration Liability (L_restoration)—the exact exergy required to return the physical substrate to baseline equilibrium. We formalize the ESCX State Vector (V_ESCX), derive the Systemic Homeostasis Boundary Condition (d/dt[S+C] >= d/dt[E+X]), and present a deployable Solidity Smart Contract (MauritianThermodynamicRegistry.sol) that embeds an Exergy Floor Price and a Homeostasis Circuit Breaker into national registries under Article 6.2 of the Paris Agreement.

Key Contributions & Deliverables:
• Carbon Cycle Exergy Paradox: Deconstruction of the thermodynamic imbalance between industrial emitters and SIDS nature-based offsets.
• EROI_ex & ESCX Formulations: Derivation of the exergonic return on investment, 4D ESCX state vectors, and physical restoration liabilities (L_restoration).
• Thermodynamically Bound GPI: A net GPI metric integrating restoration liabilities directly into corporate income statements and national welfare accounting.
• On-Chain Solidity Ledger: Production-ready smart contract code (MauritianThermodynamicRegistry.sol) enforcing Article 6.2 Corresponding Adjustments, exergy floor pricing, and homeostasis circuit breakers at the protocol layer.
• National Policy Roadmap: Four actionable policy recommendations for Mauritius under Article 6.2 negotiations ahead of COP31.