More information on the environmental effects of digitisation

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Consumers cannot see the impacts of increasing data use on energy consumption

There are high expectations for digitisation in the transition to a circular economy and in the reduction of emissions. Digitisation can indeed help in the transition to a circular economy, especially in certain sectors such as energy, construction, agriculture, retail business, industry, logistics, banking and transport.

However, the progress of digitisation and the increase in the use of data cannot happen without natural resources such as energy or materials. Digital applications and the transfer, processing and storage of data always require physical equipment and energy.

Digitisation affects all sectors of society. Forming an overall picture of digitisation and an understanding of its system-level impacts on the environment is challenging.

There were many open questions. What kind of information on environmental effects do those operating in the field report and to whom? What kind of information and data would be required to form a comprehensive picture? What kinds of digital solutions promote the transition to a circular economy and how are the solutions planned to be resource-efficient? How can we minimise the ecological footprint of the ICT sector? How can we take the development in the desired direction together?

What was achieved

At the beginning of the project, there was not very much information available publicly on the environmental impacts of digitisation. The information was also fragmented and partly conflicting.

Our goal was to increase knowledge of how digitisation and the ICT sector can promote the global transition to sustainability while at the same time taking into account the minimisation of the environmental effects of digitisation and the entire sector. We also wanted to identify the key challenges in the sector. In addition, our aim was to bring digitisation and the benefits and harmful effects of the use of data to a wider audience.

Four reports were implemented with Sitra’s funding.

1. In spring 2020, a study was conducted to determine what information is available on the electricity and energy consumption of the ICT sector in Finland and Europe. The study examined how the use of energy and electricity in the ICT sector in Finland had increased between 2011 and 2018. The study “Energy and Electricity Consumption of the ICT-sector in Finland”, funded by Sitra, was implemented by ETLA Economic Research and Aalto University.
2. In 2021, we looked at the consumption of materials and especially the amount of natural resources required by ever-increasing digitisation. The key challenges and solutions in the sector were also identified in the study. The study “Digitisation and natural resources (link in Finnish)”, funded by Sitra, was implemented by the Geological Survey of Finland (GTK), the VTT Technical Research Centre of Finland and the Finnish Environment Institute SYKE.
3. During 2021, the sufficiency of the natural resources required for the electrification of transport and in the use of renewable sources of energy was also investigated. The thesis “The demand and adequacy of natural resources needed for renewable energy utilisation and electrification of transport” was linked to the reports on natural resources and energy concerning digitisation because the same raw materials are needed for all of these and because a great deal of renewable electricity will be required for digitisation in the future.
4. In autumn 2021, the greenhouse gas emissions of supply chains in the ICT sector were examined. The study looked at how the emission intensity of Finnish companies in the ICT sector changes when the companies’ procurement and decisions on outsourcing are also included in the examination. In addition, the study detailed which countries the greenhouse gas emissions from the Finnish ICT sector and its supply chains originated from. The study “Greenhouse Gas Emissions of Finland’s Information Economy Sector: A Supply Chain Perspective” was published by ETLA Economic Research with funding from Sitra.

Who participated?

Work was carried out in co‑operation with central government and companies and organisations in the sector, and with research institutes, universities and universities of applied sciences. It included reports and research, the organisation of and participation in events, communications and co‑operation with different projects and organisations.

Reports funded by Sitra were carried out by ETLA Economic Research, Aalto University, the Geological Survey of Finland (GTK), the VTT Technical Research Centre of Finland and the Finnish Environment Institute SYKE.

Lotta Toivonen, a circular economy specialist at Sitra, was a member of the working group preparing the national climate and environmental strategy for the ICT sector under the leadership of the Ministry of Transport and Communications. The strategy was published in March 2021.

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Lotta Toivonen

Specialist, Nature and daily life

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Antti Lehtinen

Specialist, Communications and Public Affairs