A new study underscores the extent to which digital policies cannot be separated from energy policies. The research evaluates the relationship between information communication technologies and carbon dioxide emissions, and finds that the variables they used as proxies for digitalization were associated with increased emissions.
"Fundamentally, we wanted to determine whether digitalization has helped to lower carbon dioxide (CO2) emissions," says Eiman Aiyash, co-author of a paper on the work and a lecturer in economics in North Carolina State University's Poole College of Management. "Specifically, we looked at three proxies for digitalization – internet usage, fixed telephone subscriptions, and mobile cellular subscriptions – and used a statistical tool called mediation analysis to examine the direct relationship between digitalization and CO2 emissions, as well as indirect relationships operating through several economic and energy channels. Our findings suggest digitalization has not lowered emissions; quite the opposite."
For the study, the researchers drew on data covering G20 economies from 1990 through 2023. The G20, or Group of 20, consists of 19 countries and the European Union. Collectively, these economies account for the majority of the world's economic activity and CO2 emissions. The researchers collected data on CO2 emissions as well as the three proxies for digitalization, while accounting for real GDP and population growth. The analysis also examined potential channels through which digitalization may be related to emissions, including trade, industrial activity, fossil fuel energy consumption, renewable energy consumption, and electricity production from renewable sources.
The researchers analyzed the data using panel regression and mediation analysis techniques. Across the three proxies, greater digitalization was positively and significantly associated with CO2 emissions, suggesting that the expansion of information communication technologies in G20 economies has, so far, been associated with greater environmental pressure rather than lower emissions.
What's more, the researchers found that only a small share of the estimated relationship between digitalization and CO2 emissions was due to indirect effects related to industry and trade channels. Roughly 96–98% of the estimated relationship was direct association with the three proxies of digitalization.
The researchers interpret this finding as consistent with the substantial energy requirements of digital infrastructure and the carbon intensity of the electricity systems that support it.
"Our study shows that digitalization is not inherently green: in the G20, information communication technology expansion is associated with higher CO2 emissions," says study co-author Ahmed Abou-Zaid, a professor of economics at Eastern Illinois University. "So digitalization's environmental benefits will depend on whether the energy systems powering the digital economy become cleaner and more efficient."
"Our results suggest that governments should assess digital progress not only in terms of connectivity and technology adoption, but also in terms of its environmental sustainability," says Aiyash.
In particular, the researchers say, policymakers should consider:
- the carbon intensity of the electricity used to power digital infrastructure;
- the energy efficiency of digital infrastructure;
- the extent to which digital expansion is supported by renewable energy; and
- whether existing regulations help mitigate or unintentionally amplify rebound effects.
"Taken together, these findings highlight the need for a coordinated policy approach that integrates digital, energy, industrial, and climate objectives, rather than treating these areas as separate policy domains," says Aiyash. "Such an integrated approach can help ensure that continued digitalization supports, rather than undermines, broader environmental and decarbonization goals."
The paper, " ICT and CO2 Emissions in the G20: A Channel-Based Mediation Analysis ," is published open-access in the journal Sustainability. Corresponding author of the paper is Sami Alabdulwahab of King Faisal University in Saudi Arabia. The work was done with the support of an Ambitious Researcher Grant from King Faisal University.
