After a successful few months since its launch in March this year, Tees Flex recently announced plans to expand to new destinations in the Tees Valley. This on-demand bus service has provided a convenient option for people to get to work or school, or visit their doctor, using a smart mobility app. This innovation is helping to get people out of their cars, reducing congestion and carbon emissions.
While often perceived as abstract, digital technologies can provide tangible solutions like this that improve environmental outcomes and benefit communities and businesses across the country. In recent months we’ve had more glimpses of what’s possible. Broadband quickly supported new ways of working which could reduce transport emissions for a huge number of people. And, during the lockdown, digital platforms were used to facilitate the redistribution of food supplies from the hospitality sector, avoiding mountains of food waste and helping people in need.
A win-win for the environment and the economy
Much more is possible. Over the course of its two year exploration, our Tech Task Force identified numerous ways that digital technology can reduce environmental impacts. From speeding up the adoption of clean technologies; for example, through advanced manufacturing techniques to enable the fast retrofit of existing buildings, to helping the public make greener choices, such as through the use of smart mobility apps. Many other exciting applications were discussed at the launch event of the Tech Task Force’s final report this week.
Technology solutions that help the environment also improve performance. For example, digitally enabled energy efficiency could save UK businesses £6 billion a year by 2030. The 2017 Made Smarter review estimated that, by 2027, digital technology could add £38.2 billion to the construction sectors’ bottom line and that the food manufacturers could save £13.2 billion through better resource use.
The UK is lagging behind
More needs to be done to put the UK in a competitive position when it comes to taking up smart low carbon solutions. So far, fewer than one in five UK manufacturers make extensive use of digital technology in their operations. And three in four construction firms believe their sector is not digitalising fast enough on it.
Other countries, like South Korea, Singapore and Germany, are ahead of the UK on industrial digitalisation. And the EU plans to boost low carbon industry, with a focus on digital solutions, as part of its Green Deal. China has also announced investment of $1.4 trillion to 2025 in digitally enabled infrastructure. So what’s holding back investment in digital low carbon in the UK? While issues around skills, data governance and cybersecurity all play a role, an important reason has been the disjointed approach to digitalisation and meeting the UK’s net zero emissions goal. For example, some leading initiatives to increase digital adoption, such as Made Smarter and the construction sector deal, have not prioritised environmental considerations in their remit or have not focused much on areas with high environmental impacts.
At our event this week, Albert Cheung of Bloomberg New Energy Finance explained why smart low carbon solutions are more widespread in some sectors, like in the energy sector. He said one of the factors was “a really strong decarbonisation agenda [..] that really drives innovation”, “entrepreneurs come and apply new technologies to a problem that’s been well defined”. This highlights the need for the government to more clearly connect the digitalisation and decarbonisation agendas, to give UK businesses the impetus to futureproof their investments in digital solutions, ready for the low carbon economy.
There has also been underinvestment in the data and digital systems needed to support green industries. For example, there is little knowledge about material flows through the economy, despite the fact that smart technology can provide effective tracking and more granular information. This would enable more resource efficient products and business models to emerge. Policies that still rely on outdated systems are also a problem. For example, buildings energy ratings are still reliant on modelled rather than actual energy performance. This is holding back higher uptake of new digital applications to save energy in commercial buildings.
An important factor in economic recovery
The Tech Task Force emphasises, in its conclusions, that addressing these shortfalls should be a priority, if businesses and communities are to be ready for the new realities that will shape the future. And this is doubly important to assist a green economic recovery from the pandemic.
With a number of landmark strategy documents due to be published in the coming months, this is a unique moment for the government to make policy cohesive across departments and join up the digitalisation and low carbon agendas.
In his opening remarks at our event this week, Minister for Clean Growth Kwasi Kwarteng did emphasise that digitalisation will be central in upcoming policies, such as the Energy White Paper. Equally, action on climate and the environment should be central to all government relevant strategies to promote digitalisation, and it was therefore positive to hear that the National Digital Strategy will promote growth in the climate tech sector.
But we mustn’t forget that the use of digital low carbon solutions can’t progress without public support. During our event, Kathy Peach of innovation foundation Nesta, noted that, while people want innovation to promote social good and deal with climate change, only 18 per cent felt they had any say over innovation priorities. Other research shows only one in five trust technology companies to design products and services with their best interests in mind. It’s time to address these concerns and put people at the heart of the design process so we can use the full power of digitalisation to help build a an economy that is good for both people and nature.