Towards Green Transformation in the EU – With the Support of Technology

Towards Green Transformation in the EU

By Vlad Surdea-Hernea and Beste Budak

How green is digital, and how digital is ‘green’?

After the launch of the Sixth Assessment Report of the United Nations Intergovernmental Panel on Climate Change (UN IPCC), which details the physical science basis of the current climate crisis, the public space has been dominated by voices calling for increasing the pace of the transition towards a more sustainable global economic system. The European Green Deal, championed by the European Commission, aims to decouple economic growth from resource consumption by creating a more sustainable framework for development. That is why, debates on how digital transformation can help tackle climate challenges are more urgent than ever.

While international cooperation is necessary to reach global climate objectives, the green transition also needs a pragmatic arm that yields quantifiable (and fast) results to help meet energy transition targets in due time. This is where digital technologies can lend a helping hand. At the same time, the Information and Communication Technologies (ICT) sector accounts for more than 2% of global greenhouse gas emissions. The digital sector must find its own way to reduce its carbon footprint and meet high environmental standards.

The European Commission introduced several strategies to make Europe more competitive, green, and digital, such as the New Industrial Strategy and the Digital Decade strategy (“Digital Decade”), which aims to channel the advantages of new-generation technologies to benefit people, businesses, and administrations. The Digital Decade embodies the values and goals of the European Green Deal, but the journey leading to the digital and green transitions (also called the “twin transition”) can enable each other is just starting.

As new ambitious projects are being proposed, such as mass-scale green hydrogen, direct air capture, and long-duration storage, one needs to contemplate whether and how leveraging synergies with the digital sector can significantly accelerate their roll-out and market readiness.

Meanwhile, many companies have realised the importance and complexity of implementing responsible business practices, moving the topic high up on the corporate agenda and pioneering ambitious Environmental, Social and Governance (ESG) initiatives. Advancements in deep learning have facilitated the automation of complex processes across the value chains of multiple industries, assisting companies in reducing physical and digital clutter, thus improving performance and expediting the development of more sustainable economic practices.

How can the digital transformation support the materialization of the European Green Deal?

Widespread use of technology, which has increased even more since the onset of the pandemic, brings its environmental impact under the spotlight. At the same time, greener digital solutions are becoming more and more available for businesses and governments each day. In this regard, automation technologies, such as RPA (robotic process automation) and Intelligent Automation[1], are great examples of how innovative technologies can support the ‘twin transition’.

In its simplest form, RPA is a software technology that makes it easy to build, deploy, and manage software robots that emulate human actions while interacting with digital systems and software. While RPA is already used to support various business outcomes such as productivity, employee satisfaction or transparency and increased accuracy, it also encourages digital modernization which leads to a recognizable reduction in physical and digital waste.

An industry-agnostic technology, automation has a wide range of applications – from supporting traditional business outcomes to championing sustainability and eco-friendly innovations. For example, an infrastructure solutions firm that automated the processing of 400,000 invoices per year with RPA not only reached a higher level of efficiency but also managed to save 320 trees and 80,000kWh a year.

Another example is Earth Cube, an application that uses automation to analyse the impact of development on any area across different categories such as air and the ozone layer. Applications such as Earth Cube enable governments and businesses to detect the areas that need extra environmental protection and to make informed decisions when taking necessary actions.

Moving beyond simple applications of digital technologies in industries that would require a more sustainable approach, digitalisation is likely to improve the effectiveness of interactions between organizations, industries and sectors. Critical business processes, such as monitoring the supply chain, or the actual transport and distribution of goods and services, lack the efficiency needed for a no-waste future. RPA, alongside other digital solutions, can be leveraged to identify and eliminate the frictions within the system, thus helping achieve two essential goals: helping implement the organization’s sustainability agenda while improving the management and performance of the supply chain.

What are the obstacles down the road?

Recent digital developments offer promising innovations that can be used to give technology environmental targets. However, to maximize impact, the green and digital transitions require a joint roadmap that supports common goals. At the same time, greater awareness is needed to help both public and private sector organizations identify solutions to environmental challenges with the help of digital technologies.

As previously mentioned, green technologies are waiting to become ready for market deployment. This is unlikely to happen if Member States and large private companies are uncertain of how to integrate such technologies into their operations. For example:

While automation technologies can pave the way for increased transparency of the supply chain, it is insufficient that action is undertaken only from one side. Furthermore, when switching from existing technology to its green alternatives, there are several layers of adaptation including: legal amendments, changed consumer behaviour, distributional effects, infrastructure development, and novel business models. Coordination is therefore essential, and also likely the biggest challenge for early adopters.

What needs to be done?

Green transformation without digital transformation might not be impossible but is very unlikely. As previously mentioned, embracing automation solutions and other innovative technologies to tackle environmental challenges brings new opportunities for sustainable development that create broad benefits for organizations and people. Stakeholders involved in decoupling economic growth from the environmental impacts of resource consumption should consider how digital technologies can support their goals.

However, to achieve greater results, the private and the public sector must engage in mutually beneficial coordinating actions. While early adopters exist both in the private and the public sector, and are expected to continue leading the way, the objective of the European Union should be to support a harmonious twin transition across Member States and reduce existing gaps. To achieve that, policymakers, researchers, businesses, and the civil society must work together on strengthening the relationship between digital and green and create effective outcomes. A first step was taken by the European Union through the Recovery and Resilience Facility, but it’s up to Member States and business to coordinate and make sure financing instruments are put to good use.

About the Authors

Vlad Surdea-Hernea

Vlad Surdea-Hernea is a PhD student at the Doctoral School of Political Science, Public Policy and International Relations of the Central European University. He holds a master of Public Policy from the Hertie School in Berlin. Professionally, he collaborates with think tanks, NGOs and private companies from Central and Eastern Europe on topics related to climate change, energy policy and sustainability.

Beste Budak

Beste Budak is a sociologist with a master’s degree in Public Policy. Her thesis focused on the US and China’s AI policies regarding surveillance technology, autonomous weapons systems and big data usage at governmental level. Currently, she is working on a CBDC project as a research scholar at the Central Bank of the Republic of Turkey.

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