ICT Sector on the Way to Net Zero

ICT Sector on the Way to Net Zero

The digital future meets environmental responsibility. Read in this blog post how much emissions the ICT sector generates and how they can be reduced.

Estimation riddle: How many flights (cargo transport flights included) operate worldwide each day?

The correct answer will be divulged a little later in this article. Contrary to what the opening question suggests, this article is not about the aviation industry. It is actually about the information and communication technology (ICT) sector. What do the two industries have in common? They both produce roughly the same amount of greenhouse-gas (CO2) emissions, though estimates vary. According to a study by Allianz, the CO2 emissions produced by the ICT sector account for 1.8% to 2.8% of total worldwide emissions. It’s important to note, though, that emissions caused by cryptocurrencies are not yet factored in here, but more about this later.

What Does ICT Comprise?

Information and Communication Technology is a term that encompasses all forms of technology used to process, manage, and communicate information. ICT mainly includes the following:

  • Information technology (IT), which comprises computers, hardware, software, and the related infrastructure used to process, store, and disseminate data.
  • Telecommunication, which refers to all forms of telecommunications networks such as telephone lines, cellular networks, and satellite communication used for voice, data, and video transmission.
  • Internet services, which encompass all services in connection with the internet, including web hosting, cloud computing, and online services.
  • Broadcast media, which include technologies used to transmit information by radio, television, and other forms of media.
  • Network technology, which is the hardware and software that enables network connectivity, communication, and the operation and management of enterprise networks.


All of these areas together produce roughly the same amount of emissions as all of the world’s air traffic or, put more precisely – we’ll solve the riddle – as much emissions as 100,000 flights each and every day.

How Much Electricity Do Cryptocurrencies Consume?

One big question mark in ICT emissions is cryptocurrencies. Bitcoin, the world’s leading cryptocurrency, operates like many others on a proof-of-work algorithm, which requires Bitcoin miners to solve complex mathematical puzzles in order to validate transactions. That takes a lot of computing power and results in voracious electricity consumption. Moreover, if the number of miners increases, so does the complexity of the puzzles and the amount of energy consumption needed to solve them. The decentralization of cryptocurrencies makes it hard to estimate their energy consumption with precision, but it is widely believed that it could amount to as much as 240 terawatt hours per annum, more than the country of Australia’s annual electricity consumption.

How Much Emissions Do Data Centers Produce?

Numerous companies operate data centers that process, store, and distribute enormous quantites of data. A good 85 data centers in Switzerland account for around 4% of the country’s total electricity consumption. And the amount of data won’t diminish in the future. This means that the trend is headed upward. Data center emissions are caused most of all by the equipment employed to cool servers. Data centers account for around 1% of energy-related emissions worldwide. However, there is plenty of potential to reduce data centers’ electricity consumption, which we’ll come to shortly.


What Is Net Zero?

“Net zero” is reached when the amount of greenhouse gases released into the atmosphere is offset by emissions cuts and CO2 absorption. Net zero is aimed at capping the rise in the average global temperature to combat climate change. This necessitates the use of renewable energy and requires actions such as reforestation and capturing and sequestering CO2. Net zero does not mean completely eliminating emissions, but compensating for them through offsets. Implementation of net-zero commitments is a major global challenge in the fight against climate change.

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What Are the Prospects for Net Zero in the ICT Sector?

The chances of achieving CO2-neutrality look better in the ICT sector than in many other industries. The vast majority of ICT emissions result from electricity consumption. The ICT sector accounts for 4% to 6% of global electricity use. The eco-friendliness of ICT therefore depends greatly on the electricity mix used to operate systems and equipment. The math is plain and simple: the more electricity derived in the future from renewable sources, the more sustainable the ICT sector will become. But that alone is not enough, at least not in the near term.

More aggressive actions to reduce emissions are needed instead. One way to cut emissions is to improve the energy efficiency of data center cooling systems, servers, network infrastructure, and end-user devices. Optimized product life cycles, greater use of cloud computing, and improved recycling and waste management are also needed.

A study published in 2021 by the Swiss Federal Office of Energy attested potential, for instance, to reduce the electricity consumption of data centers in Switzerland by around 45%. Most of that potential stems from the cooling of servers. Trouble-free operation of servers would be possible at an ambient temperature of up to 32 degrees Celsius, but some data centers cool to a much lower temperature than necessary due to security and safety concerns.


How SIX Is Making Its Data Centers More Efficient

As an operator of financial market infrastructure and as a global supplier of financial information, SIX operates data centers in several countries. To make those data centers as sustainable as possible, a project to consolidate them was initiated in 2020. The project is scheduled to be completed by the end of 2024. Key milestones reached by 2023 included the closure of the group’s Nordic data center and the continual optimization of the energy efficiency of its data centers in Spain and Switzerland. In the final stage of the project, the data centers in France and England will be decommissioned, leaving a total of five data centers left in operation in the end: in Switzerland, Spain, Japan, Singapore, and the USA.

SIX operates its proprietary data center in Spain using 100% renewable energy. In Switzerland, a small percentage of nuclear-generated electricity is still utilized alongside renewable energy. The majority of the IT workloads at SIX are processed at those two data centers.

The data centers in Singapore, Japan, and the USA are managed by external suppliers. Electricity entirely from renewable energy sources is likewise deployed in Singapore and Japan. Some electricity derived from non-renewable energy sources is used only in the USA.

SIX embraces a hybrid cloud approach and evaluates the use of public cloud solutions on a case-by-case basis. Efforts are also underway to make the existing data centers as energy-efficient as possible, for example by cooling with outside air and by installing hot and cold aisles. Those efforts have already borne fruit. In August 2023, the data center in Zurich was awarded the SDEA SILVER Plus certification for its extraordinary efficiency and its minimal emissions. SIX is the first company in Switzerland to receive the SILVER Plus certification.

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How Will Cryptocurrencies Become More Eco-Friendly?

Cryptocurrencies’ electricity consumption would be relatively easy to lower drastically, at least in theory. How? By transitioning from proof-of-work (PoW) to proof-of-stake (PoS) algorithms to validate transactions and add new blocks to blockchains. PoW, the algorithm used by Bitcoin, consumes many times more electricity than PoS does. Ethereum, the second-largest cryptocurrency by market capitalization, switched to PoS in September 2022, reducing its electricity consumption by 99.99%. However, critics argue that the servers haven’t vanished into thin air and that their emissions have merely shifted away from Ethereum, meaning former Ethereum miners have simply switched over to other cryptocurrencies that still operate with PoW.

Experts believe that Bitcoin is unlikely to transition to PoS. PoW is too integral a component of Bitcoin’s architecture and community ethos for that to happen. In addition, attempts to ban Bitcoin have proven ineffective. In 2021, China prohibited all cryptocurrency transactions. Nevertheless, China still holds second place in Bitcoin mining right behind the USA. So, in the cryptocurrency space as well, the key to less emissions lies in large part in stepping up the use of renewable energy.

Innovation vs. Sustainability

The ICT sector continues to evolve and grow. Data is the new gold these days, and it is proliferating. Moreover, the recent boom in mass adoption of artificial intelligence appears destined to further fuel this growth. Data means knowledge and data means power, and at the same time data is the key to solving a wide range of problems. Data is also crucially important in the climate policy debate and provides answers to many questions that contribute to solving the problem. In the fight against climate change, it is vital to utilize the technologies at our disposal correctly and to strike a balance between innovation and sustainability.