Why Data Has Become the New Oil — and the Next Carbon Problem

Data is now subtly becoming the lifeblood of contemporary economies, permeating every system from satellite communication to streaming platforms, from healthcare to finance. However, underneath this mellow digital beat comes a disturbing reality: the same technology that propels human advancement also puts stress on the environment. The new oil is data, which is incredibly lucrative, incredibly transformational, and increasingly carbon-intensive.

British mathematician Clive Humby made the analogy for the first time in 2006, and it still resembles the trajectory of oil quite a bit. Similar to crude oil, unrefined data is useless until it is refined. To inform choices, automate processes, and uncover insights, it needs to be gathered, cleansed, and processed. Similar to oil conglomerates, IT businesses created empires by managing the flow of energy. The current pipelines, which are massive data centers that channel information rather than fuel, are presently run by Google, Amazon, Meta, and Microsoft.

This change is both inspiring and risky, according to Matt Watts, Chief Technology Evangelist at NetApp. The meaning of his insight that “data has mass” is extremely clear: each file, picture, and stream of content takes up physical space and requires energy to live. A vast logistical reality—servers cooled by billions of gallons of water, warehouses illuminated around-the-clock, and gear changed on an industrial scale—is concealed by the cloud’s imperceptible convenience.

Data centers use complex algorithms to monitor everything from satellite signals to supply lines, but this accuracy comes at a heavy environmental cost. Currently, these establishments use over 1% of the world’s electricity, a percentage that might triple as AI systems develop. The irony is especially stark: machines become more energy-hungry as they get smarter.

Table: Professional Information — Matt Watts

Unused data is referred to by Watts as “digital waste,” a phrase that seems both contemporary and eerily familiar. Approximately two-thirds of the data that is kept is never used again. Old backups, redundant analytics, and user archives that have been forgotten all silently demand power maintenance. More emissions are already produced by the energy required to preserve this useless data than by the world’s aviation sector. Once hailed as clean and immaterial, the digital revolution now exposes an ecological shadow as real as any smokestack.

When ownership and exploitation are taken into account, the resemblance to oil becomes even more apparent. Oil barons used scarcity to their advantage during the industrial era. These days, data tycoons dominate the market. The distinction is especially creative but equally dangerous: data is infinite, whereas oil is limited. New content is created for storage, analysis, and security with each interaction, click, and voice command. When left unchecked, this development pattern resembles the unbridled extraction that formerly characterized petroleum expansion.

Businesses have accelerated this cycle by combining cloud computing and artificial intelligence. Massive datasets are needed to train each new model, and the carbon load increases with each data point. According to reports, OpenAI’s GPT-4 needed energy to power hundreds of homes while it was being trained. The digital economy starts to resemble a massive refinery that runs continuously when you multiply it by thousands of models throughout the industry.

Despite this paradox, there is cause for hope. Businesses are starting to view sustainability as an opportunity rather than a barrier. They are gradually changing the trend by adopting carbon-conscious software design, utilizing cutting-edge cooling technology, and moving toward renewable energy sources. Government programs that encourage public institutions to employ energy-efficient storage systems, such as Scotland’s Cloud Framework, which Matt Watts helped create, significantly improve these changes.

This transformation is especially advantageous financially for many businesses. Cutting back on needless storage lowers expenses and emissions at the same time. Digital footprints have been significantly reduced by the straightforward process of detecting duplicate data, or “data hygiene,” as engineers refer to it. Businesses frequently find hidden inefficiencies when they clean up their archives, which results in quicker systems, cheaper costs, and reduced carbon emissions.

Because they understand that sustainability appeals to both consumers and employees, tech entrepreneurs are now integrating emotional intelligence in design. Ecological ethics are a major source of motivation for young engineers joining the area. For them, efficiency is a purpose as well as a performance. For them, a system’s ability to conserve intelligently—rather than just how much it computes—is what defines innovation.

Customers are also affected by this cultural change. People are becoming more conscious of the environmental costs associated with each stored photo, saved email, and streamed movie. Habits are changing as a result of the realization. In order to save energy, some streaming services now let customers choose “eco-modes,” which somewhat reduce video quality. Even though it’s a minor adjustment, taken as a whole, it greatly lowers the digital carbon footprint.

Regarding policy, governments and climate groups are starting to discuss data infrastructure as a component of the carbon discussion. Recently, the UN Environment Programme issued a warning that, if unchecked, AI-driven growth could exacerbate emissions. They encourage businesses to include statistics on energy use in their corporate sustainability disclosures. This strategy, which links environmental reporting with digital transformation tactics, is very effective for accountability even though it is still in its infancy.

The problem extends beyond societal justice and corporate responsibility. While emerging nations supply the energy, land, and occasionally labor needed to maintain data infrastructure, data-rich nations amass technological superiority. The disparity is reminiscent of earlier oil geopolitics, when resource exploitation benefited a select few while harming the environment for a large number of people. Transparent governance, investments in renewable infrastructure, and equitable access to clean technologies are all necessary to close this digital divide.

Notwithstanding these obstacles, data sustainability is gaining traction. Microsoft, Google, and NetApp are making significant investments in carbon-neutral data centers that run on solar and wind power. In order to ensure that compute loads correctly adapt to surges in renewable supply, researchers are creating algorithms that optimize energy use dynamically. These developments are especially positive since they demonstrate that environmental responsibility and technological advancement can coexist.