Data are emerging on the impact of digital technologies on greenhouse gas (GHG) emissions, and their importance is clear. The World Economic Forum (WEF) and Accenture say that digital technologies can help the energy, materials, and mobility industries reduce emissions by 4% to 10% by 2030. Capgemini reports that the AI climate potential puts the figure at 16% in many sectors.3
Despite the proven effects of these technologies, however, organizations have insufficient urgency in their adoption to facilitate the goals of decarbonization and emission reduction. Across industries, many leaders are using partners to support digital transformation, while the energy transition remains a secondary goal. Digital and sustainability leaders take a strangely conservative approach to technology that fails to solve today’s problems. As justification, they cited the immaturity of existing solutions, a need for further study or customization, and challenges from intermittent renewable energy supply to a lack of confidence in existing carbon trading schemes.
MIT Technology Review Insights conducted a global survey to explore industry leaders’ use, plans, and readiness to adopt digital technologies to reach decarbonization targets. The survey answered 350 C-level leaders of major global companies in eight major sectors, to gather their views on these solutions. Insights were also gained from in-depth discussions with nine subject matter experts.
The following are the key findings of the research:
Digitalization is the backbone that will support the energy transition. Despite differences across industries (and across regions), digital technologies are considered important (rated from 1 to 10, with 10 being the most important) for optimizing efficiency and reduction of energy and waste (scoring 6.8 overall); design and optimization of carbon sequestration technologies (6.7); making sustainability data accessible, verifiable, and transparent (6.2); monitoring of GHG sinks (6.6); and designing and optimizing low carbon footprint energy systems (5.8).
For most industries, the main lever of decarbonization is a circular economy. The majority (54%) of participants from all industries (except petrochemical manufacturing) cited the circular economy4 as their dominant environmental sustainability goal. A circular economy reduces waste with reduced consumption, increased efficiency, and resource and energy recovery. The second highest rated sustainability goal is to improve access to clean energy (41%), and third, to improve energy efficiency (40%).
Collaboration with technology experts is the way to transform the industry with digital solutions. The most cited method of adopting new digital technology is through vendor partnerships (31%). Executives are less likely, however, to emphasize the importance of open standards and data sharing throughout the supply chain to facilitate the deployment of digital technology (especially in energy, metals and mining, construction , and petrochemical manufacturing), with only 16% identifying it as the top enabler. However, experts say the adoption of open standards and data sharing — critical to AI and ML’s ability to overcome complexity — to streamline the supply chain is “inevitable” to achieve the purpose of decarbonization.
Characteristics of technology adoption and innovation vary by sector and region. Although cybersecurity is considered the biggest external barrier to digital transformation in general (58%), construction companies are particularly apprehensive (76%), while metals and mining companies are not very worried (47%). In total, 11% of respondents intend to experiment with digital technology early, but some sectors are not so motivated: only 4% in metals and mining, 5% in petrochemical production, and 6% in industrial production. Buy-in and a willingness to learn are essential for cooperation across departments and organizations.