The government’s Industrial Strategy should be harnessing the power of digital tech to drive a green economy, says report

Caterina Brandmayr Caterina BrandmayrHead of climate policy020 7630 4516cbrandmayr@green-alliance.org.uk
The government’s plans to rebuild the economy should be preparing businesses for the realities shaping the country’s future. Taking action on climate change and reversing environmental decline, tapping into the power of new digital technologies, should be central to that, says new report by Green Alliance’s Tech Task Force. [1][2]  

This autumn the government is expected to update its industrial strategy. [3] The Tech Task Force, which comprises leading businesses and innovation agencies, says that the strategy should consider government drives for digital and low carbon development as linked priorities across all parts of the economy, to put businesses on the best footing to compete internationally and support the jobs of the future. [4]

When used to help business operations shift to low carbon, digital applications can boost profits through significant energy and resource savings. For example, digitally enabled energy efficiency could save UK businesses £6 billion a year by 2030. And the 2017 Made Smarter review estimated that, by 2027, digital technology could add £38.2 billion to the construction sectors’ bottom line and that £13.2 billion could be saved by food manufacturers, through better use of resources. [5]

South Korea, Singapore and Germany are already ahead of the UK on industrial digitalisation. And the EU is planning to boost low carbon industry, with a focus on digitalisation, as part of its Green Deal. China has also announced plans to invest $1.4 trillion to 2025 in digitally enabled infrastructure. [6]

The report points to the need to drive a step change in digital adoption across UK businesses. So far, fewer than one in five UK manufacturers make extensive use of digital technology in their operations. And three in four construction firms believe their sector is not digitalising fast enough. [7] However, the task force says that, unless the government actively connects the digitalisation and decarbonisation agendas, UK businesses might miss the opportunity to futureproof their investments in digital solutions, with the risk of falling behind in growing global low carbon economy.

Caterina Brandmayr, head of climate policy at Green Alliance, said:
”Using the power of digital technology to speed up the transition to a low carbon economy is a win-win for the environment and the economy. Smart solutions not only help to cut carbon and save resources but also increase productivity and profits for business. Joining up digital and low carbon strategies should be right at the heart of the government’s recovery plans.”

Nikesh Mistry, Sector Head Industrial Automation of GAMBICA, the Trade Association for Instrumentation, Control, Automation and Laboratory Technology, said:
“Combining efforts to bring about the fourth industrial revolution and meet the net zero target would make sure UK industry remains champion in an uncertain world. We must adopt the new technologies which bring us into the digitalisation era and cut carbon to unlock greater productivity and efficiency in business.”

Rodney Turtle, VP for public policy and government affairs at Schneider Electric, said:
“Digital technology can be transformational in making better use of energy across our economy, boosting business efficiency and cutting unnecessary costs. Technical solutions to accelerate progress are already available and the UK should race ahead in making the most of these new opportunities by embedding digital and low carbon priorities in the plans for the recovery.”

ENDS

Contact
Caterina Brandmayr, head of climate policy, Green Alliance (available for interview)
cbrandmayr@green-alliance.org.uk, 020 7630 4516
 
Notes
[1] Smart and Green: joining up digital and environmental priorities to drive the UK’s economic recovery, a new report by Green Alliance on behalf of its Tech Task Force, will be published on Tuesday 20 October and is available at www.green-alliance.org.uk/resources/untitled%20folder/Smart_and_green.pdf
Green Alliance’s Tech Task Force is a business led group convened by Green Alliance. It is a forum for policy innovation for smart clean growth that aims to lead policy discussions with ambitious business thinking. Its five members are: Gambica, HVM Catapult, Innovate UK, Ramboll and Schneider Electric.
[2] The report will be launched at the Green Alliance event “Unlocking the green digital revolution for the UK: with the Rt Hon Kwasi Kwarteng MP”, on 20 October 2020, 9.30 – 10.30. This event, including an opening address from the Rt Hon Kwasi Kwarteng MP, will focus on how the UK can accelerate and join up the digitalisation and low carbon agendas to help revive the economy. For more information about the event and to register, please follow the link here.
[3] The government is reported to be updating its industrial strategy. For more information, see D Thomas and J Pickard, 27 September 2020, ‘Science and technology to drive new UK industrial strategy’, The Financial Times
[4] Other recommendations to government to ensure it joins up the decarbonisation and digitalisation agendas, include:
1. ensure digitalisation and low carbon agendas are joined up in its upcoming strategies
2. invest in smart, net zero compatible infrastructure, including better data to inform decisions;
3. strengthen skills and capabilities, including through a national programme to increase business digital adoption, explicitly prioritising low carbon applications;
4. bring people along in the transition, addressing concerns about privacy and ensuring they see the benefits of data and technology;
5. promote greener digital technology, reducing the climate and resource impacts of technology itself.
[5] Green Alliance, 2020, A smarter way to save energy; Department for Business, Energy and Industrial strategy (BEIS), 2017, Made Smarter Review; savings to the construction industry are linked to resource efficiency as well as digitally enabled construction and asset maintenance.
[6] Bloomberg New Energy Finance, 24 September 2020, ‘South Korea, Singapore, Germany lead BNEF ranking of top digitalization markets’; European Commission, 27 May 2020, ‘Europe’s moment: repair and prepare for the next generation’, press release; European Commission, 10 March 2020, ‘Making Europe’s businesses future-ready: a new Industrial Strategy for a globally competitive, green and digital Europe’, press release; Bloomberg News, 22 May 2020, ‘Infrastructure will be a top priority for China in 2020’
[7] The Manufacturer, ‘Annual Manufacturing Report 2019’; C Jensen, 11 February 2020, ‘Can the construction industry overcome barriers to digital transformation?’, Institution of Civil Engineers news

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