Digital boom could have negative consequences for the environment, warns UN trade agency

United Nations

A recent report by the UN trade agency UNCTAD has revealed concerning findings about the impact of the digital economy on the environment. The agency is urging for more attention to be paid to the negative effects and for investments in renewable energy to slow down these impacts.

According to UNCTAD chief Rebeca Grynspan, the rise of technologies like artificial intelligence and cryptocurrency has led to a significant increase in energy consumption. For example, Bitcoin mining alone has seen a 34-fold increase in energy consumption since 2015, reaching 121 terawatt hours. This is more than what countries like Belgium and Finland consume in a year.

The global digital economy is currently booming, with 5.4 billion people using the internet and business e-commerce sales reaching $27 trillion in 2022. While digital technologies have the potential to reduce paper use and improve energy efficiency, they also have a significant environmental impact and require a large amount of carbon-rich electricity.

To address this issue and promote a more equitable and environmentally responsible digital economy, UNCTAD’s Digital Economy Report 2024 offers policy suggestions for the use of precious minerals and other natural resources, such as water, in the production of electronic devices.

The report also highlights the growing concern of digital waste, which has increased by 30% since 2010 and reached 10.5 million tonnes globally in 2022. Developed countries generate significantly more digital waste per person compared to developing and least developed countries, showcasing the unequal distribution of benefits from digitalization.

The demand for minerals used in digital technologies is expected to surge by 500% by 2050, which presents an opportunity for resource-rich developing countries to add more value to their extracted minerals and diversify their economies. However, this must be done in an environmentally sustainable manner, with the transfer of efficient technology and the use of circular economy models to reduce waste and environmental damage.

UNCTAD recommends that countries work together to ensure fair access to digital technologies and resources, as well as promoting renewable energy and sustainable digital practices. The agency stresses the importance of balancing economic growth with environmental sustainability and addressing global issues like climate change.

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Mark Silaev
Glosema Account Manager