By Kalyan Sarma, VP of Climate, Environment, and Sustainability Commercialisation at Ploughshare

The rapid advancement of artificial intelligence (AI) and digital technologies presents an unprecedented opportunity to address the pressing challenge of climate change. Government investment in software that can accelerate green technologies is not just beneficial – it is essential. Such investments can unlock significant decarbonisation potential by leveraging underutilised data and enhancing the efficiency of industrial operations. As venture firms lead the way in funding AI-driven startups aimed at the energy transition, it becomes increasingly clear that government support can amplify these efforts and drive substantial environmental and economic benefits.

The Role of AI in the Energy Transition

AI is revolutionising the way industries approach decarbonisation. The rise of AI has coincided with a critical push by many industrial operators – such as factories, power plants, and trucking fleets – to digitise their operations. This digitisation generates vast amounts of data, which, if properly harnessed, can provide significant opportunities for emissions reduction and energy efficiency. Blackhorn Ventures, for example, recently closed a funding round aimed at bringing the next generation of powerful emissions-cutting software to market.

Micah Kotch, a partner at Blackhorn, has recently emphasised, as reported in a newsletter from Sifted, the importance of unlocking this data layer. AI can convert underutilised data into actionable insights that drive decarbonisation. For instance, startups are using AI to convert field reports from grid technicians into actionable data, design more energy-efficient circuit boards, and analyse drone footage for signs of malfunctioning grid hardware. These applications highlight the transformative potential of AI in improving energy efficiency and reducing emissions across various sectors.

Government Research as a Catalyst

While private investment in AI-driven green technologies is crucial, government support can significantly accelerate their development and deployment. Governments have the resources and influence to drive large-scale adoption of these technologies, ensuring they reach sectors that can benefit the most. By investing in software development and AI applications, governments can catalyse innovation, create jobs, and promote sustainable economic growth.

One critical area where government investment can make a difference is in the construction and logistics sectors. These industries are poised to benefit from new AI applications, yet they face significant barriers to digitisation and modernisation. Government funding can help overcome these barriers by supporting research and development, providing grants and subsidies for technology adoption, and establishing frameworks that encourage collaboration between public and private entities.

Moreover, government investment in its research and development of AI and digital technologies can help address the urgent need to decarbonise existing infrastructure – for example. As we’ve said a few times now, and many of our industry peers also say: solving climate change will eventually require novel hard technologies built at commercial scale. However, these developments will take years. In the meantime, deploying existing digital technologies can buy valuable time in the race to achieve net zero emissions. Governments can play a pivotal role in scaling these solutions, ensuring they are implemented widely and effectively.

The Broader Impact of Government Support

Beyond direct environmental benefits, government investment in green software technologies can drive broader economic and societal gains. By fostering innovation and supporting startups, governments can stimulate economic growth, create high-quality jobs, and enhance national competitiveness in the global green technology market. Additionally, such investments can lead to the development of resilient and sustainable infrastructure, contributing to long-term economic stability and environmental stewardship.

Government support can also ensure equitable access to green technologies, addressing disparities between different regions and communities. By providing funding and resources to underserved areas, governments can promote inclusive economic development and ensure that the benefits of the green transition are shared widely.

Government investment in software and AI technologies to accelerate green technologies is a must. By leveraging the power of AI to unlock underutilised data and enhance industrial efficiency, governments can drive significant decarbonisation efforts and promote sustainable economic growth. As venture firms demonstrate the potential of AI-driven green technologies, government support can amplify these efforts, ensuring that the transition to a low-carbon economy is swift, effective, and inclusive. Investing in green software technologies today is an investment in a sustainable and prosperous future for all. The new government’s manifesto outline of a National Wealth Fund may well be the answer to this – let’s hope we see it happen!