TOPIC 8.5

Sustainability Metrics & ESG Integration

⏱️25 min read
📚Research

Topic 8.5

Sustainability Metrics & ESG Integration

Embed environmental and social accountability into digital economy measurement. Explore the CADiS framework, rebound diagnostics, and policy levers that connect AI/compute growth with planetary boundaries and inclusive outcomes.

⏱️Approx. 25 min

🌱Sustainability Dashboard

🧭Stage 5 · ESG

CADiS Framework Summary

The Circular Assessment for Digital Services (CADiS) framework captures six sustainability metrics. Use the dashboard to understand baseline values for hyperscalers versus industry averages (illustrative data).

Energy IntensitykWh per transaction

0.82

Hyperscaler best practice; industry avg 1.35

Power Usage EffectivenessPUE

1.25

Hyperscaler range 1.1–1.3 · industry 1.58

GHG Intensitykg CO₂e/MWh

128

Depends on grid mix; coal grids 5–20× higher

Water UsageL/kWh

2.8

Cooling dominates; regional scarcity adjustments recommended

Circularity Index% devices reused/ recycled

68%

EU right-to-repair targets aim for 80%+ by 2030

Renewable Share% of energy

45%

Corporate PPAs key lever; location-based reporting required

Life-Cycle Assessment & Rebound Effects

A complete environmental assessment covers embodied emissions (chips, servers), operational energy, water usage, and circularity outcomes. Efficiency gains can trigger rebounds— offsetting 10–60% of savings as lower costs stimulate demand.

LCA Workflow

  1. Inventory hardware bill of materials (fabs, cobalt, rare earths).
  2. Model operational energy with time-of-use grid factors.
  3. Quantify cooling water + regional scarcity multipliers.
  4. Applying circularity scenarios (reuse, refurbishment, recycling).
  5. Aggregate using ISO 14040/44 or GHG Protocol for comparability.

Rebound Diagnostics

  • Direct: Efficiency lowers per-unit cost → more usage.
  • Indirect: Savings reallocated to other carbon-intensive activities.
  • Economy-wide: Productivity gains drive GDP growth and consumption.
  • Mitigation: Absolute targets, carbon pricing, efficiency + demand policies.

Policy Levers & Disclosure

Regulatory

  • Right-to-repair & circularity mandates (EU Ecodesign).
  • Data centre efficiency standards (Singapore, Ireland).
  • Carbon disclosure & science-based targets (SEC, CSRD).
  • Compute neutrality pledges for public procurement.

Financial & Market

  • Green financing for retrofits, heat reuse, renewable PPAs.
  • Carbon pricing with compute-intensity differentials.
  • Transparency portals (e.g., EU Data Centre Code of Conduct).
  • Extended producer responsibility for hardware take-back.

🎯 Key Takeaways

  • Sustainability measurement must span infrastructure energy, compute efficiency, lifecycle emissions, water, circularity, and social inclusion.
  • CADiS provides a six-metric scaffold; complement with compute equity (public access, GPU distribution) and regionalised water/carbon factors.
  • Rebound effects pose significant risk— couple efficiency with absolute reduction targets and demand-side policies.
  • Integrated reporting (CSRD, SEC climate disclosure) is steering hyperscalers toward transparent ESG dashboards; research can shape metrics.
  • Policy levers (right-to-repair, green PPAs, carbon pricing) must align with measurement frameworks to transform incentives.

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