Don’t Just Restart the Economy, Rewire It for a Digital Climate Future
Our collective response to the Covid-19 pandemic highlights many of the societal and economic benefits of digitalization. Digital tools are enabling online learning, telemedicine, and continued business. Data-driven tech also enables officials to trace, quantify, and map the virus’ spread and ultimately develop a vaccine.
There are legitimate privacy concerns about the collection and use of personal data, but few can dispute the role these digital tools play in helping flatten the curve and deploying necessary testing to gradually return to a new “normal.”
The rapid market integration of the internet of things (IOT), artificial intelligence, and advances in network communications also presents an enormous energy and climate policy opportunity to acquire and share decision-useful information on anything, from any place, at any time. This “digitalization” could unleash transformative changes needed to develop a system more resilient to future climate-related risks to our public health, economy, environment, and national security.
Digitization for Climate Goals Will Take Public, Private Efforts
Yet, designing digital solutions for societal benefits will not happen on its own. It will take purposeful action by both the public and the private sectors that has been woefully lacking on Capitol Hill. To date, there has been little effort to build meaningful data governance frameworks to guide our increasing reliance on digitally enabled infrastructure.
There has been even less effort to design data-driven climate policies that harness digital technologies to enable markets to see, price, and mitigate climate risks and achieve our collective objectives, goals, and ambitions.
With focus on building a digital climate governance framework and development of evidence-based policy levers, we can use this digital infrastructure to rewire our economy to protect public health, bring transparency to our energy system and corporate supply chains, optimize industrial and building efficiency, and reinvigorate local economic development, with the added co-benefits of lowering emissions trajectories without government mandates or politicians picking winners and losers.
How? The ability to contextualize information that was previously invisible or unavailable can drive innovation and inform future investments.
Our digital reality can power a networked, data-driven and economy-wide transition to a more equitable, low-carbon future, but only if the guardrails of our market economy are rebuilt for that context.
Policymakers should therefore start at the beginning. How can digital tools rewire the economy and its underlying infrastructure to empower individuals and reward government and corporate transparency? What level of transparency is necessary in industrial and corporate data to understand their financial, physical, and supply chain risks? What access should consumers have to decision-useful information?
Here are five suggestions:
Set digital ecosystem guardrails. The key to unlocking exponential potential of digital technologies relies on robust sector-based data governance strategies that observe critical principles of transparency, accuracy, replicability, predictability, and interoperability.
Close the digital divide and expand digital infrastructure. Ensure every community has access to broadband and incent the build out of remote sensors, AI, and industrial IOT to enable intelligent supply chains.
Make government data more accessible and interoperable. Government agencies have massive data pools and capacity to convert primary and secondary data into accessible, decision-useful information to sustain public health, national security, and the environment.
Promote climate accounting standards to better define and quantify risk. Develop guidelines for transparent tracking of products, materials, and substances across value chains, balancing the needs to safeguard companies’ commercial and strategic information with consumers’ needs for meaningful information on a product’s supply chain and life-cycle impacts.
Develop performance-based policy interventions. We can’t manage what we can’t measure. The success of market-driven policy interventions will need to be tied to corporate performance toward risk management.
Building out this digital architecture will enable a more nimble and responsive government in times of crisis, while empowering investors to better understand and value corporate risk disclosure and management. A digital architecture will provide businesses with greater insight into supply chains and the ability to better manage disruptions, while giving consumers greater understanding of the origin and impacts of the products they buy.
We urge policymakers to not just help our economy recover, but to use this opportunity to reset and rewire it by prioritizing infrastructure, tools, and technologies embedded with digital systems that are built to allow entire value chains to better identify and manage systemic risks to our public health, productivity, environment, and national security.