Digitalisation offers solutions to the climate challenge

Minister of the Environment and Climate Change, Maria Ohisalo gave an opening speech at the FiCom Forum webinar on November 1, 2022. In her speech she highlighted the importance of the digital industry in helping us to solve the energy crisis, as well as in the fight against climate change and nature loss. The minister pointed out, however, that the industry’s own carbon footprint and the growing amount of electronic waste has to be taken into consideration.

One of the greatest questions of our time is how we can arrest the climate crisis and biodiversity loss. As decision-makers, we can set out a framework for this, but you are the ones who create innovations that make the change a reality. And it often seems that business is capable of much faster change than political decisions can accommodate.

Decentralised renewable energy will be essential to resolving the energy crisis, largely due to high fossil fuel prices, and the ICT sector will be instrumental in this. Among other things, digitalisation enables the large-scale exploitation of renewable electricity and helps to maintain stability in the electricity grid. Smart solutions offer flexibility that is increasingly important to our electricity grid, as the output of renewable electricity is highly dependent on the weather and the time of day. Large-scale demand-side management is key. Smart solutions are also emerging to help manage peaks in demand in district heating networks.

ICT solutions enable energy consumption management and energy savings at many levels. For example, smart solutions can control energy use and save energy in expansive industrial processes. On the other hand, we only need to check our smartphones to find out when the electricity price and demand are at their highest. If your neighbours do not mind, you could run your washing machine at night. And perhaps you do not need to use your sauna at the busiest time of Saturday evening.

As I have said many times, the best electricity bill is one that never comes. Companies are offering entirely new solutions for consumers, and consumption can be optimised as an aspect of operations and business logic. For example, it was announced last week that automatic demand-side management would be introduced at most of the public electric car charging points in Finland.

Naturally, the energy sector is not the only one in which digitalisation can help combat climate change and biodiversity loss. Digitalisation also enables us to use resources wisely, circulate materials, and to invent new approaches to the sharing economy. Digitalisation is essential for creating a functional circular economy that efficiently saves resources. As with energy solutions, the solutions in this field will range from apps on consumers’ phones, such as those needed to access shared vehicles, to solutions for material circulation between industries. Digital platforms can act as material marketplaces and promote the emergence of markets and the development of new products and services. There is still room for improvement in how information is shared between these platforms and in cooperation between the various actors.

In a more general sense, one of the major changes necessary to reboot the economic system is to approach all our economic activity with a circular economy mindset. When Finland pushes itself to the forefront of the green transition, it will also gain new investments and jobs.

Ladies and gentlemen of this forum, if we are to build a path to a sustainable society, we need to know which route to take and what we will find along the way. We need an understanding of the state of the environment and ecosystems, which will come from various remote analysis tools and automated measurement solutions. At the same time, we need large-scale data exploitation and modelling. Digitalisation is an absolute necessity if we are to reconcile human activity with the Earth’s capacity to sustain us.

It is not my aim to make this change sound too easy or positive. The ICT sector also needs to consider the impact of the electricity and materials it uses. Cryptocurrencies are perhaps the most vulgar manifestation of this. Last year, it was reported that Bitcoin alone consumed more electricity than the state of Norway. Furthermore, mining will not replace our existing monetary system, so it carries no tangible climate benefits, unlike, for example, using remote meetings to replace business trips.

It is true that data centres, networks and hardware have become more energy efficient as technology has advanced. Indeed, Finland can point to some good energy-efficient data centres and the development of network technologies. However, constant increases in the sizes and resolutions of displays and volumes of data continue to feed the sector’s demand for power.

Waste electronic and electrical equipment is the world’s fastest-growing waste category, and hardware requires rare metals that are critical for an electrifying society. We need to set up the system so that these materials do not need to be virgin materials – the system should circulate the materials again and again. The development of energy efficiency in ICT services and software is in its infancy. Nonetheless, Finland is at the forefront of digitalisation and surely has much to offer in this regard. Perhaps this morning’s forum will cover how Finland could lead the world in green coding and create business models that promote sustainability in the sector.

Finland has aimed to be among the first to examine its ICT sector’s climate and environmental impacts at a national level in terms of the positive handprint and the negative footprint. Last year, various administrative branches, businesses, associations, universities and research institutes worked together to publish a climate and environment strategy for the ICT sector. One key point is that the ICT sector’s environmental work is largely done outside the governmental level: it is the job of companies and research institutes. Since the strategy was published, the ICT sector’s environmental work has come on in leaps and bounds. Universities are conducting an interesting study focusing on improving the energy efficiency of services. In addition, the Finnish Government’s analysis, assessment and research function will publish groundbreaking calculations of the climate impact of digitalising public services this year. Associations and enterprises have also taken the initiative to develop climate solutions and organise competitions to develop solutions. This is a welcome step.

As the green transition advances, a shortage of experts is becoming a more significant issue, along with the need to allocate expertise specifically for creating climate solutions. This is one of the main reasons I have called for an increase in the number of new students admitted to universities.

Ladies and gentlemen, it will surely be necessary to continue discussing the investments Finland could make in the climate and environmental work of the ICT sector and where our particular strengths lie. We know that one of our strengths is our knowledge – something everyone in attendance today shares. I hope you enjoy a fruitful forum discussing these topics and making change a reality.