The digital boom threatens the environment

Did you know that it takes 800 kilos of raw materials to make a two-kilogram computer? Or that the energy needed to mine bitcoins reached 121 terawatts last year, more than most small countries consume?

These are just some of the worrying findings of a new report on the digital economy by the UN Conference on Trade and Development (UNCTAD) which insists on the need to take the negative environmental impact of this thriving sector more seriously.

“The rise of technologies such as artificial intelligence and cryptocurrency mining has significantly increased energy consumption,” said Rebeca Grynspan, Secretary-General of UNCTAD.

Energy binge

“For example, energy consumption of Bitcoin mining increased 34-fold between 2015 and 2020, reaching around 121 terawatts per hour… The energy consumption of Bitcoin mining is higher than the annual consumption of Belgium or Finland,” the UNCTAD official told reporters in Geneva.

Today, some 5.4 billion people use the internet and the global digital economy is booming with obvious benefits for many. In value terms alone, business e-commerce sales have grown from $17 trillion in 2016 to $27 trillion in 2022 across 43 countries, Grynspan said.

“We talk a lot about how digital technologies can reduce paper use and improve energy efficiency, and can help reduce greenhouse gas emissions in the transport and construction sectors, agriculture and energy… But we don’t talk as much about the negative side,” he warned, stressing that digitalisation involves a high demand for resources and requires large amounts of carbon-rich electricity.

To counter this threat to the environment and support a digital economy that is equitable and responsible towards the natural environment, UNCTAD’s Digital Economy Report 2024 offers policy suggestions for the use of precious minerals used to manufacture electronic devices, including mobile phones, and other vital natural resources, such as water.

Energy-hungry sector

According to UNCTAD, global data centres will consume 460 terawatt hours in 2022, the equivalent of the energy used by 42 million US households in one year. This figure is expected to double by 2026.

The UN agency also cites estimates that the digital sector is responsible for between 1.5% and 3.2% of global greenhouse gas emissions, a figure similar to that of air and maritime transport.

Between 2018 and 2022, electricity consumption of thirteen major data centre operators more than doubled, highlighting the urgency of addressing the energy and water footprints of these technologies.

“Google revealed that in 2022, total water consumption in its data centers and offices amounted to about 21.2 million cubic meters. For the same year, Microsoft “The company reported that its water consumption was 6.4 million cubic meters,” Grynspan said, adding that the water consumption by these facilities had fueled tensions in communities in several countries.

According to Microsoftonly training for ChatGPT-3 required an estimated consumption of 700,000 liters of clean, fresh water, he said.

Digital and energy footprint

The report notes that e-commerce has skyrocketed, with online shoppers growing from fewer than 100 million in 2000 to 2.3 billion in 2021. This increase has led to a 30% rise in digital waste between 2010 and 2022, reaching 10.5 million tonnes worldwide.

“Digital waste management remains inadequate. This is of great concern given the pollution it generates and its impact on the environment,” said Grynspan.

The report also states that developed countries generate 3.25 kg of digital waste per person, compared to less than 1 kg in developing countries and just 0.21 kg in least developed countries, which is a further indicator of the unequal distribution of the benefits of digitalisation.

Critical minerals

He world Bank estimates that demand for minerals needed for digitalisation, such as graphite, lithium and cobalt, could increase by 500% by 2050.

Developing countries are key in the global supply chain of minerals and transition metalswhich are highly concentrated in a few regions.

For example, Africa’s vast mineral deposits, essential to the global shift to digital and low-carbon technologies, include cobalt, copper and lithium, crucial to a sustainable energy future.

The continent has significant reserves: 55% of the world’s cobalt, 47.65% of manganese, 21.6% of natural graphite, 5.9% of copper, 5.6% of nickel and 1% of lithium.

Development opportunities

“The increase in demand for critical minerals represents a opportunity for resource-rich developing countries to add more value to extracted minerals, diversify their economies and enhance their development.

But the technology needs to be transferred and made more efficient to be compatible with environmental and climate change goals, Grynspan said.

According to the report, amidst current global crises, limited fiscal space, slow growth and high debt, developing countries should make the most of this opportunity through domestic processing and manufacturing.

This would help them secure a greater share of the global digital economy, generate public revenue, finance development, overcome dependence on raw materials, create jobs and raise living standards.

The report says rising global demand for clean energy commodities is already driving foreign direct investment in Latin America, accounting for 23% of the value of greenfield projects in the region over the past two years.

recommendations

UNCTAD suggests new business models and sound policies to make digital growth more sustainable. UN trade and development experts’ direct recommendations to the world include:

• Use circular economy models, focusing on recycling, reuse and recovery of digital materials to reduce waste and environmental damage
• Optimize resources by creating plans to use raw materials more efficiently and reduce overall usage
• Strengthen regulations, apply stricter environmental standards and rules to reduce the ecological impact of digital technologies
• Invest in renewable energy, support research and development of energy-efficient technologies and sustainable digital practices
• Promote international cooperation, encourage countries to work together to ensure fair access to digital technologies and resources, and address global issues of digital waste and resource extraction

“The digital economy is critical to global growth and development opportunities, so we must pursue practices that lead us to a win-win space that do not run counter to our important environmental sustainability goals and climate change commitments,” concluded Rebeca Grynspan.