Brussels, 29 June 2022
The Commission has today adopted the 2022 Strategic Foresight Report – “Twinning the green and digital transitions in the new geopolitical context”. As we prepare to accelerate both transitions, the report identifies ten key areas of action with the objective of maximising synergies and consistency between our climate and digital ambitions. By doing so, the EU will strengthen its cross-sector resilience and open strategic autonomy, and be better prepared to face new global challenges between now and 2050.
Maroš Šefčovič, Vice-President for interinstitutional Relations and Foresight said:
To reach climate neutrality by 2050, we need to unleash the power of digitalisation. At the same time, sustainability must be at the heart of the digital transformation. That is why this Strategic Foresight Report takes a deeper look at how to best align our twin objectives, especially as they take on a significant security dimension due to the current geopolitical shifts. For instance, from 2040, recycling could be a major source of metals and minerals, inevitable for new technologies, if Europe fixes its shortcomings in the area of raw materials. Understanding this interplay between the twin transitions, while striving for open strategic autonomy, is the right way forward.
The green and digital transitions are at the top of the Commission’s political agenda set out by President von der Leyen in 2019. In light of Russia’s aggression against Ukraine, Europe is accelerating its embrace of climate and digital global leadership, with eyes firmly on key challenges, from energy and food, to defence and cutting-edge technologies. From this perspective, the 2022 Strategic Foresight Report puts forward a future-oriented and holistic analysis of the interactions between the twin transitions, taking into account the role of new and emerging technologies as well as key geopolitical, social, economic and regulatory factors shaping their twinning – i.e. their capacity to reinforce each other.
Technologies essential for the twinning towards 2050
On one hand, digital technologies help the EU achieve climate neutrality, reduce pollution and restore biodiversity. On the other hand, their widespread use is increasing energy consumption, while also leading to more electronic waste and bigger environmental footprint.
Energy, transport, industry,construction, and agriculture– the five biggest greenhouse gas emitters in the EU – are key for a successful twinning of the green and digital transitions. Technologies will play a key role in reducing these sector’s carbon footprint. By 2030, most reductions in CO2emissions will come from technologies available today. However, achieving climate neutrality and circularity by 2050 will be enabled by new technologies currently at the experimental, demonstration or prototype phase.
- In the energy sector, novel sensors, satellite data and blockchain could help strengthen the EU’s energy security, by improving the forecasting of energy production and demand, by preventing weather-related disruptions or by facilitating cross-border exchanges.
- In the transport sector, a new generation of batteries or digital technologies, like artificial intelligence and internet of things will enable major shifts towards sustainability and multimodal mobility across different modes of transport, even short–distance aviation.
- Across industrial sectors, digital twins – a virtual counterpart of a physical object or process, using real-time data and machine learning, – could help improve design, production and maintenance.
- In the construction sector, building information modelling could improve energy and water efficiency, affecting design choices and use of buildings.
- Finally, in the agriculture sector, quantum computing, in combination with bioinformatics, can enhance understanding of the biological and chemical processes needed to reduce pesticides and fertilisers.
Geopolitical, social, economic and regulatory factors affecting the twinning
The current geopolitical instability confirms the need to not only accelerate the twin transitions but to also reduce our strategic dependencies. In the short-term, this will continue affecting energy and food prices, with the significant social fallout. In the medium- and long-term, for instance, sustainable access to raw materials critical for the twin transitions will remain of paramount importance, adding pressure to move to shorter and less vulnerable supply chains and to friend-shoring wherever possible.
The twinning will also require hinging the EU’s economic modelon wellbeing, sustainability and circularity. The EU’s position in shaping global standards will play an important part, while social fairness and the skills agenda will be amongst the conditions for success, alongside the mobilisation of public and private investment. It is expected that almost €650 billion will be needed in additional future-proof investment annually until 2030.
Ten key areas of action
The report identifies areas where a policy response is needed to maximise opportunities and minimise potential risks stemming from the twinning:
- Strengthening resilience and open strategic autonomy in sectors critical for the twin transitions via, for instance, the work of the EU Observatory of Critical Technologies, or the Common Agricultural Policy in ensuring food security.
- Stepping up green and digital diplomacy, by leveraging the EU’s regulatory and standardisation power, while promoting EU values and fostering partnerships.
- Strategically managing supply of critical materials and commodities, by adopting a long-term systemic approach to avoid a new dependency trap.
- Strengthening economic and social cohesion, by for instance, reinforcing social protection and the welfare state, with regional development strategies and investment also playing an important role.
- Adapting education and training systems to match a rapidly transforming technological and socio-economic reality as well as supporting labour mobility across sectors.
- Mobilising additional future-proof investment into new technologies and infrastructures – and particularly into R&I and synergies between human capital and tech –with cross-country projects key to pooling EU, national and private resources.
- Developing monitoring frameworks for measuring wellbeing beyond GDP and assessing the enabling effects of digitalisation and its overall carbon, energy and environmental footprint.
- Ensuring a future-proof regulatory framework for the Single Market, conducive to sustainable business models and consumer patterns, for instance, by constantly reducing administrative burdens, updating our state aid policy toolbox or by applying artificial intelligence to support policymaking and citizens’ engagement.
- Stepping up a global approach to standard-setting and benefitting from the EU’s first mover advantage in competitive sustainability, centred around a ‘reduce, repair, reuse and recycle’ principle.
- Promoting robust cybersecurity and secure data sharing framework to ensure, among other things, that critical entities can prevent, resists and recover from disruptions, and ultimately, to build trust in technologies linked to the twin transitions.
The Commission will continue to advance its Strategic Foresight Agenda, while informing the Commission Work Programme initiatives for next year.
On 17-18 November 2022, the Commission will co-organise the annual European Strategy and Political Analysis System (ESPAS) conference to discuss the conclusions of the 2022 Strategic Foresight Report and prepare the ground for the 2023 edition.
Strategic foresight supports the Commission on its forward-looking and ambitious path towards achieving President von der Leyen’s six headline ambitions. As of 2020, based on full foresight cycles, annual Strategic Foresight Reports are prepared to inform the Commission’s priorities defined in the annual State of the Union address, the Commission Work Programme and multi-annual programming.
This year’s report builds on the 2020 and 2021 Strategic Foresight Reports, which focused on resilience as a new compass for EU policymaking and on the EU’s open strategic autonomy, respectively.
The analysis presented in the 2022 Strategic Foresight Report was based on an expert-led, cross-sectoral foresight exercise conducted by the Joint Research Centre, complemented by broad consultations with Member States, and other EU institutions in the framework of the European Strategy and Policy Analysis System (ESPAS), as well as with citizens through a call for evidence published on Have Your Say. The results of the foresight exercise are presented in the Joint Research Centre’s Science for Policy report: ‘Towards a green and digital future. Key requirements for successful twin transitions in the European Union’.
2022 Strategic Foresight Report: Twinning the green and digital transitions in the new geopolitical context
2022 Strategic Foresight Report webpage
Questions and answers on the 2022 Strategic Foresight Report
Website on strategic foresight
JRC Science for Policy report: Towards a green and digital future. Key requirements for successful twin transitions in the European Union
2022 Strategic Foresight Report – EU Commission Q&A
1. What is strategic foresight and how does it support the EU’s policymaking?
Strategic foresight is a systematic approach to look beyond current expectations and explore plausible future developments. Its aim is to identify policy implications for the present. Using a range of methods, such as horizon scanning, megatrends analysis and scenario planning, the von der Leyen Commission has started to embed strategic foresight across its major initiatives, in support of the EU’s political agenda. Ultimately, this anticipatory governance helps us future-proof our policies.
Annual Strategic Foresight Reports are the flagship products of the Commission’s strategic foresight agenda. Their objective is to heighten policymakers’ awareness of long-term trends, as well as of less noticeable phenomena that have a significant potential to impact the EU and the world. The increased awareness allows for catered solutions to address related opportunities and risks. The foresight agenda subsequently informs the Commission’s Work Programmes and the multiannual programming.
The 2022 Strategic Foresight Report looks at the long-term interaction and reciprocal reinforcement – what we call ‘twinning’ – between the digital and green transitions in the current geopolitical context (most notably, with regards to Russia’s military aggression against Ukraine).
2. What are the key takeaways of the 2022 Strategic Foresight Report ?
There are four important takeaways from this year’s report:
First, it identifies synergies and tensions between the twin transitions. Digital technologies can play a key role in achieving the EU’s climate neutrality by 2050 and help restore biodiversity. However, the increasing use of digital technologies will increase energy consumption and the amount of electronic waste. Pursuing the green transition will also transform the digital sector. Towards 2050, its increasing energy needs should be further covered by fossil-free sources, such as renewable hydrogen.
Second, it highlights the critical role of digital technologies in greening the EU’s five vital and most greenhouse gas emitting sectors, namely: energy, transport, industry, construction and agriculture.
Third, it outlines the different geopolitical, social, economic and regulatory factors that will affect the twinning in the run up to 2050. Russia’s military aggression against Ukraine confirms the need to accelerate the twin transitions and reduce our strategic dependencies. Securing in the long term sustainable access to raw materials will be of utmost importance. Technological competition could also rapidly increase. While this will strengthen the EU’s democratic model and spur further innovation at global level, it may also pose risks related to cybersecurity and disinformation. The role of the EU in shaping global standards will remain key, but achieving the twinning will also require fairness (most notably on up- and re-skilling opportunities) being at the heart of both transitions. The EU will also need to adjust its economic model towards greater wellbeing, sustainability and circularity.
Finally, taking into account the new geopolitical context, the report identifies ten key areas of action for the EU to ensure the successful twinning of the green and digital transitions by 2050 (see press release).
3. What is ‘twinning’ and what are its objectives?
Twinning refers to the interplay between the green and digital transitions, and more specifically their capacity to reinforce each other. For instance, until recently, the digital transition progressed with only limited sustainability considerations.
Better understanding their interaction is key to maximising their synergies and minimising their tensions. This is essential in the current geopolitical context, where the EU aims at accelerating both transitions and at strengthening its resilience and open strategic autonomy.
4. How is the new geopolitical context related to the EU’s twinning objectives?
Thelong-term implications of Russia’s military aggression against Ukraine, including for energy, food, the economy, security, defence and geopolitics, will clearly affect Europe’s path to achieving fair green and digital transitions. This confirms the need to accelerate the twin transitions, reinforcing the EU’s resilience and open strategic autonomy.
While cutting our dependency on Russian oil and gas, the current context also highlights the urgency to reduce other strategic dependencies. For instance, the EU’s dependence on third countries, including China, in the area of critical raw materials is currently even greater than our dependence on Russia’s fossil fuels.
5. What are some of the concrete synergies and tensions observed in relation to the twin transitions?
There are many examples of positive synergies between the green and digital transition, particularly in sectors that are vital for the EU’s economy. For instance:
- More circular business models will help reduce electronic waste and reduce the EU’s dependencies on third countries for critical raw materials. According to industrial estimates, recycling could be the EU’s major supply source for most transition metals after 2040.
- By measuring and controlling inputs, and with increased automation, technologies like robotics and the internet of things could improve resource efficiency and strengthen the flexibility of systems and networks.
- Digital technologies could play a key role in achieving climate neutrality, reducing pollution, and restoring biodiversity. For example, personal monitoring of pollution exposure or contribution and access to environmental data through networks of micro-sensors and smart devices will empower people in their choices.
- Data sharing or gamification can increase public participation in steering the transitions and co-creation of innovations.
- Pursuing the green transition will transform the digital sector. For example, achieving climate neutrality and energy efficiency of data centres and cloud infrastructures by 2030, including by meeting their electricity demand with solar or wind energy, will support the greening of technologies, such as big data analytics, blockchain, or the internet of things.
However, there are also areas where the two transitions could negatively affect each other. These are identified as tension points. For instance:
- The energy consumption could increase if digital technologies do not become more energy-efficient. ICTs are responsible for 5%-9% of global electricity use. This could grow as the use of blockchain, internet of things, platforms, search engines, and virtual reality applications increase.
- The greater use of digital technologies could increase electronic waste and its environmental impact. It could reach 75 million tons by 2030.
- The green and digital transitions will require more raw materials. For example, the use of lithium in the EU, mainly in batteries, is projected to raise by 3500% by 2050. However, their extraction, mining and processing can also be damaging for the environment and water security. This can also raise ethical concerns. This being said, the EU and its Member States already have a good legislative framework in place to ensure that mining takes place under environmentally and socially sound conditions.
6. What about economic and social factors? How important are they for the twinning?
Economic and social factors are paramount for a successful twinning in the run up to 2050. If technology is a pre-requisite for twinning, the green and digital transitions need to be fair, inclusive and affordable for all. This will require active labour market policies, adjusted social protection and welfare systems, as well as adequate compensation for citizens and businesses facing costs related to the transition.
The transitions will also require additional private and public investment. The additional private and public investment needs for the twin transitions could amount to nearly €650 billion each year until 2030. In the current geopolitical situation, additional investments will need to take into account the risks related to increasing public debt, a potential shift in financial priorities and an overall uncertain economic outlook. Against this backdrop, economic policies need to be adapted to steer additional investment into technologies supporting the twinning.
7. What about the focus of the previous and next Strategic Foresight Reports?
The three editions of the annual Strategic Foresight Report follow a logical sequence.
The 2020 Strategic Foresight Report focused on resilience across four dimensions: green, digital, social and economic, and geopolitical.
Building on this last one, the 2021 report focused on the EU’s open strategic autonomy as part of the geopolitical dimension of resilience. It was particularly timely in view of the ensuing geopolitical turmoil.
Next year’s report should focus on key upcoming challenges and opportunities that Europe will face in the decades to come, providing strategic insights relevant for strengthening the global role of the EU.
 The translated versions of the 2022 Strategic Foresight Report will be available as from 20 July 2022 in all EU official languages.
Source – EU Commission