How digital transformation should drive the energy transition

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Annamaria Arcese
Regional Sales Director
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Digital Transformation Driving Energy Transition

Written by Anna Maria Chase, Regional Vice President in Sales Force

As we face the urgent challenge of climate change, we also grapple with transitioning to a net-zero emission energy system. This, while also meeting the growing demand for energy. Today, we'll discuss how digital technology and AI can play a critical role in driving this energy transition.

Understanding The Urgency

The impacts of climate change are growing day after day. However, the current commitments put us on a path to reduce emissions by only 7.5% by 2030. Significant change is needed to reach a 55% reduction and keep the Global Agreement on track. We all must consider highly efficient, circular, and sustainable ways to make a meaningful impact on emissions - and digital technology can prove instrumental in this journey.

Embracing Digital Technology

Digital technology is transformative. It has seeped into every aspect of our lives, and in the context of energy efficiency, it presents novel ways to operate energy systems, improve operations, enable sharing economy, track greenhouse gas emissions, and more.

While digital technology is powerful, we must also tread cautiously. According to estimates, ICT is responsible for between 2.1% and 3.9% of global greenhouse gas emissions, similar to the aviation sector. Thus, the projected increase in digital innovation also raises concerns around increased direct material impacts.

ESG Factors and Sustainable Development

Amidst growing pressure from various stakeholders, businesses are finding themselves at the crossroads of implementing digital solutions to meet Environmental, Social, and Governance (ESG) goals.

  • 83% of consumers believe companies should be actively championing ESG best practices.
  • Around 70% of employees expect their company to have an ESG agenda.
  • 85% of investors consider ESG factors in their investments.
  • 91% of banks along with 24 global credit rating agencies monitor ESG.

The approach towards ESG goals is shifting from voluntary disclosure to becoming more regulated, leading to CEOs adopting ESG strategies for competitive advantage.

Potential of Digital Solutions

An efficient digital strategy can potentially reduce global emissions by 20%. How?

  • Sharing of autonomous, transparent data to optimize resources and enhance efficiency.
  • Prioritizing digital inclusion and skill development to ensure workers have access to digital technologies.
  • Fostering cross-team collaboration within businesses and across industries.

The key here is to focus on an inclusive, sustainable digital transition that benefits everyone.

Sustainable Digital Transformation

A sustainable digital transformation relies on five pillars – prioritizing measurement, building infrastructure, conducting impact analysis, changing leadership model, and making conscious technology usage choices.

The COVID-19 Impact and Future Directions

The COVID-19 pandemic significantly impacted the focus on digital transformation and environmental sustainability. While 38% of organizations globally decreased their attention on sustainability, 18% put it all on hold. Simultaneously, 46% of organizations have increased their focus on digitalization, indicating an imbalance between the two.

Moving Forward: Balancing Digitalisation and Sustainability

It's evident that digital sustainability is becoming an essential discussion. However, it's equally important to strike a balance between technological developments and environmental benefits. We must remember that every digital footstep counts towards the environment's well-being – hence, measuring the combined carbon footprint of technology manufacturers, infrastructure, and billions of internet users is crucial.

In conclusion, the responsibility is not only on companies but also on the consumers. We all must be aware of the environmental impact and make conscious, responsible choices. It’s a collective effort, and with awareness, the right mindset, and sustainable solutions, we can drive the energy transition successfully.

Make every day a day for a green deal!


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