Can technology act as a catalyst to a just climate transition?

– Prof. Deepti Ganapathy
IIM Bangalore

Digital technologies offer immense leverage to achieve resource efficiency and decarbonisation

Without digital technologies and combined ecosystems, we have little chance of embracing climate action. While state actors and non-state actors debate at COP 30, organisations—whether not-for-profits, listed companies or SMEs—are staying invested in determining a just and smooth transition. The climate clock is ticking away. We are 3 years, 246 days away from the 1.5 degree rise in temperature. According to the Lancet Countdown report, we were exposed, between 2019-2023, on average to 46 more days of health-threatening heat than expected without climate change, reaching a record high of 50 more days of health-threatening heat in 2023. Economic damages from climate-related extreme weather in 2024 is pegged at $318 billion — from $280 billion in 2023 — with insured losses on trend to $145 billion in 2025.

Climate change and biodiversity loss will require companies to embrace energy transition and circular transition aggressively. Circularity helps in up to 45 per cent of emissions reduction from material usage. Eighty per cent of EU material use, for instance, could be supplied from end-of-life sources by 2040. Circular models offer resilience and competitiveness. Resource efficiency and circularity are thus important levers towards net zero and towards security and geopolitical trade resilience.

Digital technologies offer immense leverage to achieve resource efficiency and decarbonisation. Partner ecosystems broaden the industry scope. Together, they are force multipliers. Through this article, we provide a few digital and ecosystem showcases that are powerful industry enablers towards circular transition.

The combination of rising power of chips and the scope of cloud is potent to elevate the scope of digital technologies and democratise their usage. Industrial AI — a once-in-a-century opportunity — is a strategic inflection that compounds what digital technologies can achieve. The top three digital technologies impacting decarbonisation are AI-driven data analysis, prediction and autonomous systems. Industrial AI enables up to 30 per cent savings in infrastructure platforms and 24 per cent CO₂ reduction in manufacturing. They potentially can help cut 0.9–2.4 Gt emissions by 2030. Technology leaders like Siemens, with their strong domain expertise, converge these enablers to create lasting circularity impact. Siemens, in a few of its own factories, has witnessed up to 40 per cent waste reduction and 42 per cent energy savings from embedded AI.

Examples

• Distribution grid in the Netherlands: Serving over 3 million consumers and with rising demand, grid congestion is not uncommon. Use of digital twin and autonomous AI-powered grid-scale platforms has enabled autonomous grid management, improving utilisation by 30 per cent.
• Additive manufacturing for battery pack handling: Industry typically used complex, heavy end-effectors to handle relatively light components. Designed in the digital twin and made through additive manufacturing, 3D-printed robot grippers, with simplified parts, created up to 90 per cent reduction in CO₂ and 50 per cent energy savings.
• Waste reduction in glass manufacturing: Traditional mould cleaning methods caused damage, leading to increased raw material usage and energy waste. An AI-driven robotic cleaning system optimised the cleaning process using 2D and 3D imaging data, integrating data analytics to improve optimisation. Cleaning time reduced from 5 hours to 2 seconds—saving 700,000 tonnes of raw materials per year and cutting 1 billion kg of CO₂ each year in emissions.
• Power usage in one of the most energy-efficient data centres in Estonia: Using building management software (BMS), white-space cooling optimisation (WSCO) and energy/power management software (EPMS), a power usage effectiveness (PUE) of 1.2 was achieved against an industry average of 1.6.

While these are sector-specific examples, cross-sector collaboration offers unique pathways to entrench circularity.

Ecosystems partnering

Siemens generates thermoset plastic waste from its production facilities for LV switchgear. This waste could not be recycled within its own process. Through collaboration with a leading cement manufacturing company, recycling was achieved. The partner could valorise waste by grinding the body plastic and blending it with cement to create a variant. About 80 per cent reduction in landfill waste was thus achieved through cross-sector loop closing.

Another example concerns SF₆ gas, used in MV switchgear. When switchgear reaches end-of-life, in many cases, gas is released. SF₆ has a global warming potential of some 3,200 years. Siemens developed a reliable extraction apparatus and ecosystem partners for safe transport/recycling. By conservative estimates, this initiative has the potential to save about 17 kt of emissions until 2030.

Organisations are co-stakeholders, along with governments, consumers and multilateral bodies, in the larger scheme of climate action. Therefore, with an innovation mindset and a genuine love for the planet, businesses must embrace such technologies at scale to create value. Without digital technologies and combined ecosystems, we have little chance of embracing climate action. It is surprising how with such innovative business ideas the possibilities can be immense. Yet, we have achieved only 30 per cent of the UN SDGs globally. Innovative and impactful climate solutions are core to survival. We must show climate leadership to not only spearhead such initiatives but also create a just transition for an equitable future.

Source: The Hindu Business Line