SUSTAINABILITY
As Canonical ’ s Sharma notes : “ One of the issues facing the tech industry in reaching net zero is the energy intensiveness of blockchain , artificial intelligence ( AI ), the cloud and big computing .
“ According to the Cambridge Bitcoin Electricity Consumption Index ( CBECI ), Bitcoin consumes nearly 100 TWh per year of electricity and data centres use 200 TWh per year .
“ Cloud computing and the powerful computing needs of AI are fueling much greater energy consumption .”
Despite the energy consumption of fintechs to bring innovative solutions to the table , Sharma believes that “ there is a huge opportunity for the fintech sector to bring innovative services and develop new business models that enable net zero and establish climate resilience .”
But how can fintechs lead a drive to net zero given the energy-intensive means they employ to harness data and deliver solutions ?
Sharma boils it down to three categories of direct and indirect emissions : “ Fintechs can help create a net zero world by adopting science-based Green House Gases ( GHGs ) reduction across their supply chain and operations .
“ They can then enable other businesses with tools and technologies to develop net-zero products and services and enable consumers to take action by aligning spending and investment with net zero .
“ Fintechs can help financial institutions to get better data on ESG and impact analytics around their portfolio companies , to enable greener investment and divestment decisions .
“ Fintechs can enable financial institutions ’ compliance with climate risk regulations and embed net zero in capital markets .”
The demand for climate changebased fintech firms is growing too , something Sharma feels is “ evident from the flurry of investment seen from asset owners and financial institutions in the last couple of years .”
The rise of climate change-based fintechs Investment in climate changebased fintechs is no shot in the dark . Noreika ’ s HeavyFinance facilitates sustainable investments through its Green Loans , “ connecting individual investors with borrowers in need of equipment financing , enabling sustainable financing solutions that align with environmental objectives ”, according to the CEO .
128 November 2023