Thirty-eight of the world’s 150 leading tech companies are on track to become carbon neutral by 2030, with several aiming to be carbon negative soon after, according to a report by the International Telecommunication Union (ITU) and the World Benchmarking Alliance (WBA).
The new report, Greening digital companies: Monitoring emissions and climate commitments, documents the greenhouse gas (GHG) emissions and energy use of 150 of the world’s leading tech companies.
The study strives to enable tech companies to adopt best practices, accelerate emissions reduction, and “green” themselves to eliminate carbon-dioxide (CO2) and other GHG output from their operations.
If other digital companies would emulate those currently leading in the quest for carbon neutrality, it could make information and communication technologies (ICTs) one of the greenest sectors of the global economy, the report asserts.
“Tech companies are an essential part of the global economy,” said ITU Secretary-General Houlin Zhao. “This new study serves as a roadmap to drive all these companies towards net-zero emissions. This is the way to ensure today’s digital transformation accelerates climate action – and to do so before it’s too late.”
Part of the solution
Operational GHG emissions among the 150 companies accounted for 239 million tonnes in 2020, equivalent to 0.8 per cent of the world total. Yet digital companies – defined as those that produce and sell ICT equipment, operate telecommunication networks, and provide software and other information technology services, including data centres and cloud computing – have also become prominent in the race to eliminate harmful emissions.
Gerbrand Haverkamp, Executive Director at WBA, said: “Digital companies and their innovative nature are indispensable drivers of change to build a future that is not only technologically connected, but also fair and sustainable for both people and the planet. This report is testimony that digital companies can and must play a notable role in the race to reduce greenhouse gas emissions and invest in solutions aligned to the Paris Agreement. We hope this research can incentivise companies themselves to learn from best practices, reduce their emissions, and improve their energy efficiency across all their operations.”
Ramping up climate response
From renewable power purchases and investments in carbon capture to issuing green bonds, these companies are at the forefront of global GHG reduction efforts. Digital companies accounted for seven of the top ten largest corporate purchasers of renewable energy in 2020, making up almost half of the renewables purchased globally that year, the report found.
Corporate energy sourcing is a crucial factor as countries strive to cut their emissions under the 2015 Paris Agreement, which seeks to limit the rise in average global temperatures at 1.5 degrees Celsius.
Doreen Bogdan-Martin, Director of the ITU Telecommunication Development Bureau, said: “It is no secret that as we increase our use of technology services, networks and devices, energy consumption and emissions increase in tandem. But digital technologies can be part of the solution, too. They can directly address challenges related to climate change, help scale up renewable energy markets, support smart power grids and smart metering for buildings, and of course enable emissions reductions from our work through solutions like video conferencing.”
Overall, the 150 tech companies covered by the study consumed 425 terawatt-hours (TWh) of electricity in 2020, around 1.6 per cent of the world total. Of that amount, around one third was renewable.
In many cases, companies purchase voluntary offsets to make up for unavoidable emissions. These offsets can support projects such as solar and wind farms in low- and middle-income countries, as well as the provision of environmentally friendly cookstoves and Pay-As-You-Go solar electricity services.
Renewable energy supply challenges
Low- and middle-income countries frequently face energy challenges, including limited electricity access or unreliable grids, resulting in over-reliance on dirty diesel-powered generator sets. To address such challenges, governments need to create favourable conditions for renewable energy use.
At the same time, tech companies are not always getting the renewable energy they pay for due to the design of electrical grids. In response, a multi-stakeholder group of energy buyers, energy suppliers, governments, investors and other organizations have partnered “to accelerate the decarbonization of electricity grids by adopting, enabling, and advancing 24/7 Carbon-free Energy (CFE)“, meaning that every kilowatt-hour of electricity consumption is met with carbon-free electricity sources, every hour of every day, everywhere.
About the report
The Greening digital companies: Monitoring emissions and climate commitments report draws on climate data published by tech companies themselves to uncover insights, assess where the industry will be by 2030, review climate performance by company and region, and highlight innovative practices to reduce the sector’s environmental footprint.
ITU’s work as the United Nations specialized agency for ICTs includes developing technical standards that provide guidance on achieving net zero emissions. This includes helping countries and the ICT sector meet the targets of the Paris Agreement and achieve the Sustainable Development Goals set out by the United Nations.
WBA is a non-profit organization that assesses and ranks the performance of the world’s most influential companies in terms of the UN Sustainable Development Goals. Among various benchmarks published by the organization, the Digital Inclusion Benchmark assesses the world’s 150 most influential tech and telecom companies through evidence-based metrics on digital inclusion and sustainable development.