Tech Talk | The role of digitalisation in energy saving

While concerns are growing on the rise of digital applications such as AI, the digital technologies themselves enable energy and emissions savings.

Digitalisation is very much front and centre in the energy sector currently and it is too in other sectors as they look to harness the benefits.

While key enablers of digitalisation, such as data centres and artificial intelligence are of concern as their number and the level of activities grow, a new study from Capgemini’s research institute indicates that the implementation of the digital technologies themselves can yield savings.

According to the study, through their implementation organisations have reduced their energy consumption by almost a quarter over the past five years, while also a 21% decrease in greenhouse gas (GHG) emissions has been delivered.

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Moreover, further reductions are in prospect, even as digital footprints expand.

The use of technologies to reduce the carbon footprint, coupled with advances in energy efficiency within the digital landscape, suggest that the benefits are expected to outweigh the environmental costs, affirming the significant positive impact of digital technologies, the report states.

The eco-digital era

The report projects that the eco-digital economy – i.e., that delivers economic value and environmental and social value – will grow at a rate of 15% annually to double in size over the next five years.

Digital platforms and software drive this, 5G comms and emerging technologies such as generative AI, digital twins and quantum computing, with outcomes expected to boost innovation, productivity and decision-making and drive the emergence of new revenue streams.

Based on the five-year emissions reductions of the organisations, growth scenario modelling by Capgemini Research Institute indicates that over the next five years, digital technologies could deliver a net emission reduction of between 8-12%, significantly outweighing their associated 2% footprint.

For example, tools such as augmented and virtual reality reduce the need for travel.

Energy consumption can be optimised with digital solutions and they can be used to aid informed decision-making to mitigate environmental impact.

A case cited is LG Electronics in Changwon, South Korea. It achieved a 17% productivity boost, 70% higher product quality and a 30% energy consumption reduction by converting its assembly-line simulation into a digital twin integrated with real-time data.

Another is Schneider Electric, which at its Le Vaudreuil site has implemented IIoT sensors and real-time digital twins of plant installations, resulting in a 25% reduction in energy consumption and a 25% reduction in emissions as well as a 17% decrease in material waste.

Additionally, a zero-reject water-recycling station connected to cloud analytics and monitored by an AI model at the company’s smart factory has led to a 64% reduction in water usage.

The research also indicates that organisations have only scratched the surface of the current technological landscape, harnessing around 25% of the overarching potential of mainstream digitalisation technologies such as AI/ML, robotics, automation and the Internet of Things.

This indicates immense untapped possibilities in digital innovation – and with digital investment as a proportion of revenue expected to double in the next five years, these will undoubtedly result.

For reference, the top investment priorities are scaling mainstream technologies such as data and the cloud, cybersecurity and privacy measures and reskilling of the existing workforce.

Capgemini’s research institute also provides some recommendations on how to harness the opportunities of the eco-digital era.

These include identifying efficiencies across the business to drive cost savings, striving for a balanced blend of short-to-medium-term successes and reinvesting savings into digital transformation.

Sustainability and accessible performance metrics also should be embedded into the product and services lifecycle.

The study was based on a survey of 1,500 senior executives at large global organisations and high-value start-ups, and so it is not energy sector-specific. Nevertheless, it highlights not only the internal benefits your company can achieve but also the external with a further recommendation to tap into the industry and supplier ecosystem, i.e. of you the reader, to accelerate improvements.

Jonathan Spencer Jones

Specialist writer
Smart Energy International

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