The Internet’s Environmental Footprint. What We Can Do Better: Regulation.

The internet is one of the main contributors to global greenhouse gas emissions. Compared to countries, it ranks 5th, just after China, the USA, the EU-27, and India, and it exceeds the combined 3.6% impact of the aviation and shipping industry, incl. pre-pandemic slowdowns.

As highlighted in the first part of this series, it seems appropriate, if not conservative, to estimate the internet’s environmental impact at about 4–7% of global emissions. I’d argue that the scale of this impact absolutely requires to think about how to reduce and mitigate — and do so fast.

Today’s focus will be on the need for regulation to incentivise more ambitious change in the tech sector. This is but one element of the overall transformation our societies need to be sustainable; yet, given the importance and increasing ubiquity of digital technologies, one that deserves more dedicated attention.

In the next two blog posts, I’ll look at managing change in businesses and future narratives to shift mindsets, respectively.

Environmental Reporting: Status Quo

Currently, environmental reporting in the tech sector is entirely voluntary. Taking action to reduce and mitigate therefore is too.

If debates around privacy, data protection, discrimination, and racial justice have taught us anything in the last few years, it is this: we must not forget to question the power and disparate impact of the technologies we deploy.

Transparency is a first, critical step to allow us to even ask such questions.

If you look at the press releases and marketing pitches of Big Tech, it may seem that their ambitious-sounding sustainability pledges got it all covered. You’ll read about net-zero emissions, carbon-negative operations, investments into community resilience and more. And don’t get me wrong, we need big tech players to assume their responsibility for the environment.

But do they have it all covered or is the crux is in the detail?

The GHG Protocol

The most common standard for greenhouse gas emissions (GHG) accounting is the GHG Protocol, which provides guidance for calculating seven major greenhouse gases. These can then be converted into metric tons of carbon dioxide equivalent, mtCO2e. This is the value that makes results comparable across companies, sectors, and regions.

The GHG Protocol covers 3 scopes. Scope 1 assesses direct emissions, scope 2 includes emissions from purchased electricity, heating or cooling, and scope 3 spans a company’s value chain, captured across 15 categories.

Reporting against scopes 1 and 2 is usually referred to as “operational emissions”, which are much easier to control and steer by the company itself. Once companies start accounting for scope 3 emissions, things get a lot more interesting — and much harder to scrutinise and compare from the outside.

The 15 scope 3 categories are: Purchased Goods and Services, Capital Goods, Fuel- and Energy-related Activities, Upstream Transportation and Distribution, Waste, Business Travel, Employee Commuting, Upstream Leased Assets, Downstream Transportation and Distribution, Processing of Sold Products, Use of Sold Products, End-of-Life Treatment of Sold Products, Downstream Leased Assets, Franchises, and Investments.

Generally, each of these categories is assessed for materiality, i.e., would including it notably change the overall emissions captured in a company’s GHG inventory? For instance, Upstream Transportation and Distribution is unlikely to be of material relevance if a company only sells software and does not physically transport or store products. Similarly, if the company does not have any franchises, this category won’t be inventoried either.

Material Climate Commitments?

As a consumer who is trying to make conscious choices, reading ambitious climate commitments is certainly encouraging. Yet, in the voluntary market of reporting, how does one know whether a company is really taking responsibility for all its emissions?

Let’s look at a few examples.

In March 2021, Netflix launched its “Net Zero + Nature” campaign that emphasises its commitment to social impact and sustainability. The declared goal is to “achieve net zero greenhouse gas emissions by the end of 2022 and every year thereafter.”

Netflix’s overall carbon footprint for 2020 is estimated with 1.1 million mtCO2e.

Does that cover all material categories? No.

Excluded in their GHG inventory is the use of their product, namely the impact of their 167 million subscribers. As you may recall from my first post in this series, online streaming is one of the major contributors to the internet’s environmental impact. One hour of streaming is estimated to require 36g of CO2e. Even if each subscriber only watched for 1 hour each month, we would still look at an additional 72.144 mtCO2e. At an hour each week, it jumps to almost 3.8 million mt — 3x Netflix’s reported overall impact. And in reality it is even higher, given data showing that an average U.S. subscriber was streaming 3.2 hours per day.

Simply pointing to internet service providers and device manufacturers to account for these emissions, only diffuses responsibility — and presents an incomplete picture, including for understanding how meaningful their commitments are.

Similarly, Facebook pledged to achieve net zero GHG emissions for scope 1 and 2 in 2020. After 5 years of GHG accounting, 2019 marked the first year that Facebook included additional categories of scope 3 in their inventory and committed to reach net zero for their value chain in 2030.

In 2019, Facebook accounted for 6 million mtCO2e.

Wonder if any material categories are missing? Difficult to tell.

According to the footnotes, one is led to believe so. Though it strikes me as odd that the use of their product, namely the 2.7 billion of people accessing their Facebook profiles and messages is estimated to account for less than 1% of their overall environmental impact. In addition, there is no mention of either WhatsApp or Instagram, both of which would add their share of emissions as well. Chances are these emissions far, far exceed what is currently being reported.

On the hardware side, Apple reported 22.6 million mtCO2e in 2020.

Their report certainly seems comprehensive, and materiality and methodologies are explained as well. Interestingly for consumers, their commitments read: “We’re carbon neutral. And by 2030, every product you love will be too.” (Emphasis mine.)

This feels no doubt highly ambitious on a resource and manufacturing level. Much more difficult to discern is the impact of their software offerings, such as Safari, Keynote, iCloud, iMessage and machine learning applications like Siri. It is one thing to account for the electricity required to build them but another to assess a) their impact on the user side and b) the lifecycle of the physical impact of data centres.

Next: Mandatory, Transparent Environmental Accounting

With big impact comes big responsibility. It is hardly surprising that big tech players, who dominate the market in profit and reach, also contribute significantly to the internet’s overall environmental impact.

There has certainly been a positive trend of voluntary corporate commitments. However, the ambiguity around whether a company’s value chain is included and if so, to what extent, is ultimately deflecting responsibility.

To be clear: Pledging a reduction in scope 1 and 2 emissions does not mitigate the internet’s environmental impact. For that, emissions related to the processing, use, and end-of-life treatment of digital technologies need to be reduced as well.

This means that we cannot rely on voluntary measures. We need regulation that makes transparent, material environmental reporting in the tech sector mandatory. As we saw in the examples above, “small” omissions of scope 3 categories can quickly multiply the currently reported impact, adding vast amounts of additional emissions.

Digital technologies are often presented as a solution to achieving a sustainable transformation. But without understanding their environmental impact, we simply do not know whether their contributions are in fact a net-positive for the climate.

Any regulation or public investment in combatting the climate crisis must be based on transparent and standardised data with clear direction for responsibility. The more you profit from a growing user base, the more you need to be held to account for their impact.

The burden to figure out which climate pledges are credible and what’s greenwashing cannot be on the consumer.

Further Reading

If this caught your interest and you’d like to dig deeper on the reports of other tech players, here are the commitments and, where available, inventories from Amazon (51.17 million mtCO2e in 2019), Google (12.5 million mtCO2e in 2019), Microsoft (11.16 million mtCO2e in 2020), Salesforce, and Alibaba.

Next week, I’ll talk more about managing change in a business. The week after that I’ll talk about narratives for and of the future.