Businesses shift towards AI to manage energy

More than a third of Australian businesses are using or planning to use AI to help manage their decarbonisation, according to Schneider Electric’s 2024 Sustainability Index.

In addressing concerns about the huge amount of energy AI consumes, Lisa Zembrodt, principal of Sustainability Business for Schneider Electric, said the survey results demonstrate the positive role AI can also play in reducing emissions.

“The role of technology is critical in the management of the net zero transition,” Zembrodt said. “While development and use of AI tools can be demanding on power supply and grid systems, these tools can also offer great support for business in monitoring and controlling emissions.

“This survey shows companies are increasingly recognising the critical role technology plays in moving to a low carbon economy, with most investing more in digital transformation than they were three years ago.”

The survey revealed that 53% of companies were increasing investment in digital transformation, 39% in automation and 36% in renewable power. 46% of companies stated they were investing more in AI and analytics, while only 5% were investing less compared to three years ago.

Nearly one in 10 companies said they are already using AI as a resource for decarbonisation transformation, the survey found. One in four were in the process of implementing AI strategies and another 29% said they were discussing them.

“Information is power,” Zembrodt said. “Data is key to managing climate risk — without it, companies don’t have insights into what’s driving their emissions.

“If companies have access to real-time data, combined with analysis, there is much greater scope to respond to emerging issues, see where there are inefficiencies, pivot where possible and increase sustainability.”

Zembrodt explained that technologies such as digital twins, monitoring, visualisation and automation were among the quickest ways to understand and reduce emissions.

She added that productive uses of AI include advanced algorithms to reduce energy consumption and emissions by optimising processes such as heating and cooling systems in buildings and optimising energy demand to alleviate consumption peaks.

Despite the evidence that many businesses are taking action to become more sustainable, the survey also found that less than one in five companies have an overarching decarbonisation roadmap or strategy in place, and 40% are not yet acting to decarbonise.

“Companies need to realise the urgency of climate action,” Zembrodt said. “With new climate-related financial disclosure regulations beginning to roll out next year, having a roadmap to transition your business to the low-carbon economy will be essential.”

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