November 8, 2018

In addressing climate change, digitalization is a key part of the solution

Maija Tenhunen

Senior Manager, Sustainability, Tieto

Recent news headlines have made for grim reading. The ICT sector’s energy consumption is in the rise. Most of internet traffic today is video streaming. Bitcoin uses as much energy as Ireland. Our love for smartphones and gadgets could be endangering the planet. Hang on! Did the digital economy just become the bad guy in the fight against climate change?

So is ICT bad for the environment? As the world goes digital, we can expect the ICT industry’s energy consumption to keep growing. There will also be some side effects and they should rightly be examined, especially through the lens of sustainability. But let’s pause for a moment and put these developments in broader perspective: ICT actually has a hugely net positive impact on the health of our planet.

Climate change does not respect state borders, let alone organizational boundaries. To understand it, and to tackle it, we need to approach it with a systemic mindset. When one activity is changed, it changes others and so on. We need to speed up towards low carbon economy by stopping and changing our activities. The changes, like ICT and digitalization enabled changes do have a footprint too. The question is, is the new way greener enough than the old way?

Extensive research published in 2015 by GeSi, the Global eSustainability Initiative, estimated that emissions avoided through the use of ICT are nearly ten times greater than the emissions generated by deploying it. Granted, it would be good to have a fresher macro analysis to hand right now, but those numbers still speak loud and clear.

The sector’s reputation of course also depends on how well individual ICT companies manage their dual agenda. Customers’ digital business renewal should result in a lower CO2 footprint for the customer, i.e. a positive handprint for the ICT partner. On the other hand, they must keep their own footprint as low as possible, align with the Paris agreement by using the best available technologies and renewable energy. Not every ICT company handles this dual responsibility well.

Fortunately, at Tieto, we can be greatly encouraged by our own efforts. Consider the example of our data centers. When our customers move data from their own physical servers to cloud in our data centers, electricity consumption can be cut by as much as 90%. How is this possible? Firstly, think of it as pooling resources¬ – just as car pooling or public transportation is greener than using our own cars. The cloud is the ICT world's public transportation, and using one is simply much more efficient than your own dedicated environment.

Large data centers must use low carbon solutions for cooling to reduce the unit consumption. For example, at Tieto, the servers are cooled using district cooling. Hot and cold aisles ensure we can efficiently collect the heat generated by the servers and recycle it back to the district heat network. In 2017, we heated around 800 homes in the city of Espoo with this recycled heat. This benefit is not even shown on the PUE (power usage effectiveness) figures often used to measure and compare the efficiency of data centers.

On the other side of the dual agenda, we need to think what are the systems and stored data used for. The goal should be that the use is greener than the old alternative. At Tieto, we reported our carbon handprint for the first time in 2011 and have since experimented with further quantification of our environmental impact. In other words, through several rounds of trial and error we have strengthened our capability to define scope, collect data and evaluate the attractiveness of customer projects from an environmental perspective. From all of this work, we have learned that:

1. While it is nearly impossible to quantify the carbon footprint of processes involving data in cloud environments, compromise and put effort into finding a relevant comparison instead.
2. You will never have complete, unchanging case studies as the number of IT services is large and they keep changing quickly. Instead, focus on findings that indicate direction and scope.
3. The biggest benefits for people and our planet lie in cases with multiple sustainability benefits. For example, operative process automation can reduce carbon footprints, increase transparency and battle the grey economy. Or AI can help patients get diagnoses quicker than ever before, save costs and increase the environmental efficiency of healthcare units.

Companies and consumers alike can cut their CO2 footprints by automating banking, insurance and accounting processes. This means, for example, banking online and choosing to receive invoices and letters in digital format. In 2017, Tieto's customers avoided roughly 75 kilotons of CO2 through the use of these services. In short, our carbon handprint is larger than the carbon footprint from our operations.

When you think of what’s possible just by changing everyday processes, the mind boggles as to what will be possible through innovation – not just in healthcare or banking, but every industry, including the energy sector itself. Indeed, as digitalization gathers pace, there are plenty of reasons to be optimistic about the role of ICT in helping in the fight against climate change. There are no options – instead of gambling with the planet, we need to take the lead and perform our role the best we can!

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