Decarbonization and Artificial Intelligence: Solving the biggest challenge with the most powerful technology?

Research suggests that Artificial Intelligence can reduce global greenhouse gas emissions by 4% to 16% until 2030. Almost 75% of all emissions are caused by producing and consuming energy. More AI for energy needs to be developed, if decarbonization is one of the goals.

What's the current thinking on decarbonization, AI and energy, also in the light of the latest AI achievements?

How big is the decarbonization ‘opportunity’?

The decarbonization opportunity is substantial. McKinsey assumes that to reach net zero by 2050 requires about $275 trillion in cumulative spending on low-emission assets globally (around 7.5% of global GDP every year for 30 years). They also think that decarbonizing energy, industry, transport, and buildings is the most significant opportunity in a generation for many businesses. Since 2015, six decacorns and one hundred thirty five unicorns have been created within the sustainability space. 

A potential of between 9 and 12 trillion Dollars in annual sales could emerge by 2030. Why? Because capital and customer demand shift towards a low-carbon economy. Morgan Stanley suggests that between 3 and 10 trillion Dollars of Earnings from decarbonization are up for grabs. The global decarbonization market was already more than $1.5 trillion in 2022.

How big is the AI opportunity?

AI is often hailed as the 4th industrial revolution. It holds great promise in addressing complex challenges and improving many functions and processes within organizations and across industries. Users now can interface with Generative AI via the Internet. This has led to a strong awareness of AI in the public. AI could contribute up to $15.7 trillion to the global economy in 2030, according to Price Waterhouse Coopers.

Is energy AI the real opportunity?

Boston Consulting Group assumes that applying AI to corporate sustainability amounts to roughly 1 to 3 trillion Dollars in value by 2030 (this comes from additional revenues and cost savings with emission reductions from AI of 5 to 10%). This value can only be captured via investing money in AI and supporting data systems and technologies.

For electricity grids, the market potential for AI could be more than $10bn soon. Energy AI therefore can generate significant business-building opportunities and is very likely to soar in the future!

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