Transparency & the digital realm: A briefing for nonprofits and call for collaboration

We need your help to bring transparency into the digital realm.

Editing by Michael J. Oghia, originally written for the SDIA as a call for action towards philanthropy, charity, and nonprofit organizations.

Digitalization is becoming the driving force behind many governments’ attempts to modernize and improve economies. At the same time, our knowledge and information on the impact of the digital economy and its infrastructure on the environment and society is significantly limited. The digital sector is still young but is growing and maturing at an unprecedented speed. Today, we can observe this growth mainly through the growing financial valuations of digital product and service businesses. Many of them, even publicly listed companies, act with great secrecy and do not embrace transparency. To ensure this growth is sustainable, and in fact, to ensure that digital technology has no negative impact on the environment and society, we must strive for transparency and data. The Sustainable Digital Infrastructure Alliance (SDIA) has been pivotal in calling for transparency and seeks your support to scale its efforts.

Background

Many governments are putting digitalization at the top of their agenda. With this increased priority on accelerating the digital transformation, accountability, transparency, inclusion and the implementation of human rights in the digital realm is coming swiftly into focus. The push for the digital industry, cloud computing, the internet of things, smart cities, and artificial intelligence are giving rise to companies of unprecedented size albeit a still limited understanding of how the business models of these companies work and how the lofty valuations are derived – what and who the product and the customers are is still unclear.

What is becoming more clear is that this new digital economy is not running on a cloud made of air and water, as the name might suggest. It is running on infrastructure, consisting of fiber and mobile networks, data storage and processing facilities, and IT hardware powered by semiconductors, which is powered by increasing amounts of electrical power and scarce resources. Even though the massive efficiency gains over the last decades have ensured that the digital economy grows without a linear demand for new infrastructure,  most of the efficiency improvement potentials have unfortunately been exhausted a decade ago – the end of Moore’s Law of doubling computing capacity every two years, the decrease in costs of storage as well as the efficiency of cooling and power conversion within the data center. The effect is simple: for the first time, we can witness a direct, linear correlation of the growth in digital infrastructure with the growth of the digital economy. In 2020, new construction of data centers alone reached a new record, adding more than 1 gigawatts (GW) of new capacity across Europe and the United States. This equals 8.76 terawatt-hours (TWh) per year; in other words, it is as if New York City has increased its power consumption by 20% in one year. And this does not include the massive growth of digital infrastructure observed in China, Africa and India over the last year.

Accurate data, however, on the size of digital infrastructure does not exist. A sector that is accustomed to secrecy, its infrastructure has always been a well-kept secret, often citing security reasons and the criticality of this infrastructure – similar to how large technology firms keep their opaque algorithms locked down from external scrutiny. This secrecy, exemplified by the fact that there is almost no accurate information on the size, energy and resource consumption, or amount of servers for most of the largest technology companies is making it difficult to assess the true costs and value of digitalization. The lack of transparency is further making it difficult to hold businesses accountable or verify their sustainability claims. With many claiming they will be completely carbon-neutral in just a few years, how they are calculating their emissions is perplexing given that the manufacturing of the server hardware in itself is extremely complex and energy-intensive.

Furthermore, owning digital infrastructure is increasingly about power and is driving a new digital divide across countries and different income groups. With many insinuating that “data is the new oil,” people forgot that owning the data is not enough; only if you can build refineries and pipelines big enough to process and transport the oil can it be turned into a sellable product. And here is where many global technology companies have already invested over decades, to own the largest pipelines (fiber-optic sea cables) and refineries (hyperscale data centers).

The example of oil raises the most important aspect: do we know the full effects of digitalization on the environment, society, and economies? Or are we so enthralled by the prospects of what digital technology can do that we ignore the potential negative consequences on society and the environment?

When fossil fuels were first discovered, we did not fully grasp the environmental effects of burning these fuels en masse. We are now suffering from this decision with the imminent climate crisis. Thus, it is imperative that we learn from the past: transparency, accountability, and the fundamental ability for society and governments to oversee the impact of the digital sector on the environment, society, and our economies must be a critical component of the push for digitalization.

This transparency is equally important to how technology is being built and how it is being used. Being able to hold algorithms and their creators accountable for how they make decisions is as important as understanding the impact of its use in products that affect society and the number of resources that are needed to operate. Transparency is key to a cost-benefit view from a resource, environmental, and social perspective.

It’s already working: Transparency in transport as a conduit for innovation, research, and collaboration

The similarities between the transport sector and digital infrastructure are striking and, therefore, serve as a good reference point. Both have a complex value chain, with many actors, suppliers and businesses, varying and often conflicting commercial interests, and are the focus of government regulation aimed at reducing its environmental impact.

In the transportation industry, for example, companies are already embracing the collection and publication of open data to support the search for novel solutions. Freight transport alone accounted for 15% of all human emissions in 2010, which is expected to reach 12 gigatons of carbon dioxide by 2050 in a business as usual scenario (McKinnon, A., 2018). In response, Alan McKinnon, one of the leading researchers in sustainable logistics, has stressed that due to the high complexity of the value chain, the transportation industry will need to rely on collaboration to reduce its environmental impact.

Based on this insight, the sector has introduced myriad initiatives based on open data about traffic and transportation routes. One of these initiatives includes “Transport for London,” a collection of publicly available data sets by the UK GovLab on transportation data in Europe’s largest city (Hogge, 2016). The platform, which mostly contains data sets based on real-time data, has led to a total number of 362 innovations within transport services and traffic management, while reaching more than 4 million people.

Not only do commercial projects benefit from open data in logistics, but also academia and governments can make use of it, creating a better environment for the industry that reported this data. The research team of Chen (2016) has used online open data to predict traffic congestion patterns, while Martins-Turner et al. (2020) have used an open-source transport simulation (MATSim) software to investigate whether electric trucks can be sustained in a practical environment. Elsewhere, Sierpiński (2017) developed a freight planning system based on open data from the application OpenStreetMap.

On the governmental side, the German Federal Ministry of Transport and Digital Infrastructure has initiated an EU-wide dialogue between government, public authorities, industry, and research institutes, investigating which innovations can already be implemented in EU member states based on open mobility data and how multimodal transport can be further exploited.

These academic, governmental, and economic initiatives demonstrate how open data creates a closed loop of benefits. Research and innovation benefit from reliable and accessible data, while in return, data providers receive valuable information and solutions to their main challenges without spending any resources on finding the solution themselves.

The similarities are striking to digital infrastructure – a complex value chain, with many actors, suppliers, businesses, varying, and often conflicting, commercial interests, and government policy and regulation aimed at reducing its environmental impact.

Without transparency and open data, we can not validate policy goals and self-regulation

The digital sector has been the first to embrace radical climate targets – from Microsoft committing to be carbon-negative by 2025 and Google committing to be carbon-neutral by 2025, to Cisco, Intel, and many others already committing to ambitious climate targets. In Europe, we have seen the recently announced Climate Neutral Data Center Pact propose a self-regulatory system based on a set of goals  metrics, which now counts many data center operators who are suppliers to large technology companies as supporters.

On the policy side, the EU has defined its target to have all data centers become carbon-neutral by 2030. Meanwhile, the OECD has set the objective to “coordinate and cooperate to better measure digitalization across G20 economies” and to “ensure competition in the ICT [information and communications technology] sector and across the economy.” When examining companies reporting toward these goals, however, there is one thing that stands out: the absence of non-percentage-based metrics for anything related to energy or resource consumption of digital infrastructure. We can find numerous numbers on the number of power purchase agreements (PPAs) signed – big technology companies are among the largest purchasers worldwide – but no information on the baseline metrics, such as the total power consumption of data centers, how many servers and IT components are being purchased per year, etc. There are notably, though, percentage reductions, such as found in Google’s 2020 sustainability report:

“In 2019, we resold nearly 9.9 million units into the secondary market for reuse by other organizations … “A study published in 2020 showed that while the amount of computing done in global data centers increased by about 550% between 2010 and 2018, the amount of energy consumed by data centers grew by only 6% during the same period.”

With the absence of metrics that allow us to measure progress toward the achieving the Sustainable Development Goals as well as realizing national policy objectives, it is difficult to understand how and if we are going to reach them. Moreover, it is especially difficult to then conduct independent and transparent assessments of any stated progress or development beyond such self-regulatory mechanisms.

This needs to change. We need data to ascertain the true size of the digital economy and its impact on the environment and society. We need to be able to hold the digital sector, with its digital products, services, and technologies, to account. And governments need this information to develop appropriate policies to support the development of the sector, especially in regards to sustainable development. For this to happen, transparency is a fundamental prerequisite.

Together, we can bring transparency into the digital realm

To create transparency, the Sustainable Digital Infrastructure Alliance has brought together key actors from across the digital economy and digital infrastructure sector, together with the research community as well as government actors. In summer 2021, we announced our key initiative, the Open Data Hub, to create a place for organizations from the digital sector to report six key sustainability metrics based on our Roadmap to Sustainable Digital Infrastructure by 2030.

These include Emissions as measured by carbon dioxide equivalent (CO2eq), energy consumption as measured by terawatt-hours, pollution, waste from electrical and electronic equipment (WEEE), also known as e-waste, resource consumption as measured by abiotic resource depletion potentials (ADPs), and the cost of digital power as a socio-economic indicator. These metrics are a starting point to get a perspective on the total size, environmental impact, and costs of digital infrastructure, and will be expanded based on the input from our multi-stakeholder platform.

How we can collaborate together:

• We are looking for grants to finance both the development of our Open Data Hub as well as promote transparency both within the industry and with governments.
• We can support nonprofit organizations with assessing the sustainability of digital initiatives and IT infrastructure of themselves and the projects & initiatives they support.
• We are looking for policy support in order to join forces on a global push for transparency from the digital sector.
• Using the Open Data Hub, nonprofit organizations can perform analysis and utilize statistical data and visualizations to develop publications related to the digital economy
• And we are looking for your knowledge, experience, and expertise from other industries, your network, or from your work within the digital sector that can help us on our path to create a transparent digital sector.