Winning essay explores how businesses across Europe can benefit from the digital transformation to enhance their efficiency and productivity, while simultaneously reducing their carbon footprint.
Congratulations to Dr Filip Mandys, Bennett Institute for Public Policy, and Dr Shivani Taneja, University of Kent, for winning the 2023/2024 Rybczynski Prize for their essay, “Is digitalisation boosting the decarbonisation of industries?” The Prize of £5,000 was awarded by The Society of Professional Economists and sponsored by KPMG for the best piece of writing in business economics in the year.
The authors discuss the challenge of industrial growth driving global economic growth, but also increasing CO2 emissions from fossil fuels. While digitalisation has transformed company operations, its environmental impact is debated. On one hand, modern information and communication technologies (ICTs) are energy-efficient, but their expansion may also raise industries’ carbon footprint due to the greater number of devices used.
Using data from 14 sectors in 16 countries (1995-2020), they found that a 1% increase in ICT capital reduces electricity use by 7.8% on average, with the effect being particularly strong in the manufacturing sector. Digitalisation was found to have an increasingly stronger energy-saving effect over time, with Germany and the UK benefitting the most from ICTs.
The results provide useful insights to industrial sectors, businesses, and policymakers, motivating them to adopt modern digital technologies to reduce their carbon footprint and reach the climate target of net-zero emissions.
“The Rybczynski Prize covers important real-world economic challenges, and decarbonisation represents one of the key topics of today’s world. The findings of our research show that businesses across Europe can benefit from the digital transformation to enhance their efficiency and productivity, while simultaneously reducing their carbon footprint.” ”
Dr Filip Mandys, Research Associate, Bennett Institute for Public Policy
Read: Is digitalisation boosting the decarbonisation of industries? (Published on spe.org.uk)
The views and opinions expressed in this post are those of the author(s) and not necessarily those of the Bennett Institute for Public Policy.
