Drivers and effects of digitalization on energy demand in low carbon scenarios

Noam Bergman and Tim Foxon

Abstract

The world is currently facing two socio-technical transitions: shifting to a low-carbon society, and a digital revolution. Despite some claims to the contrary, evidence suggests that spread and adoption of information and communication technology (ICT) does not automatically lead to reduction in energy demand, if this stimulates new energy-using practices or wider economic growth. Despite this policy challenge, the two transitions are often considered separately. This study examines potential drivers of reductions or increases in energy demand due to digitalization identified in recent leading global and UK net-zero transitions scenarios. We analyse the scenarios in terms of effects of digitalization on energy demand by identifying specific direct effects of ICT; indirect and rebound effects in transport and home energy use; and wider effects via economic growth. This analysis implies that the future pathways adopted for digitalization will have a significant impact on future energy demand and hence on the feasibility and acceptability of achieving net-zero goals. We find there are different assumptions and development pathways between scenarios. We also identify a need for better inclusion of behavioural effects and other social science understanding in scenarios on the one hand, and recognition that policy can affect digitalization pathways on the other. Overall, our work suggests opportunities for further research and potential for improving policy interactions between these two transitions, and stimulating greater public debate on the different framings for an ICT-driven low-carbon transition.

Banner photo credit: Alireza Attari on Unsplash