IoT Devices Are Changing the Global Emissions Game

IndustryWeek's elite panel of regular contributors.

Manufacturers are under growing pressure to reduce greenhouse gas emissions. The Internet of Things—and more specifically, environmental sensors—marks a new frontier to help those reduction strategies succeed.

IoT devices offer a triple promise to improve both operational and environmental performance: increasing operating efficiency and profitability, reducing emissions and objectively documenting the reductions to prove a good-faith commitment to solving the problem.

At the heart of this versatility is the fact that smart devices can document an operations’ efficiency (or lack thereof!) at this moment, allowing operators and decision-makers to both act on and share that data in near real-time.

In the past, operating data was only available after it was measured by mechanical gauges, then reported (usually on paper) up the chain of command. By the time managers made adjustments or otherwise reacted to the data, it was usually dated. Based on conditions that might no longer exist, their reactions could lead to wild oscillations instead of increasing efficiency. As a Siemens report said about the old approach, “The problem most industrial organizations face is that they can only monitor aggregated energy consumption for an entire facility. They lack real-time visibility into energy efficiency on the shop floors.”

Now there are IoT devices to report real-time data on most critical sustainability measures, including carbon footprint, energy and water consumption, and how much is saved due to conservation and innovation efforts.

IoT sensors are especially valuable regarding environmental issues and remote operations. Think, for example, of oil pipeline problems in remote areas, especially of leaks that might have gone unreported for hours or days in the past, creating disasters. Now, they can be turned off immediately and repair crews dispatched quickly.

Shell contracted with Koncar Electronics of Croatia to build a system for its Nigerian pipeline. End-point devices give Shell real-time data such as pipeline pressure, temperature and flow. The system replaced an outmoded manual system and works in difficult terrain, uses low power and transmits data two ways and securely over long distances.

While deployment of IoT-based systems is in the early stages, the potential to reduce global-warming emissions is impressive:

Ericsson reports the IoT could reduce emissions by as much as 63.5 gigatons by 2030 if all industrial sectors participated aggressively.
The combined-cycle power plant GE created for the French utility EDF achieved the highest efficiency rating (62.22%) ever, while its CO2 emissions are approximately 55% less than a standard thermal power plant.  Adding many more sensors boosted the operating efficiency.
Siemens, largely by deploying its own IoT technology, has become a leader in emissions reductions while simultaneously increasing operating efficiency. In 2015, the company was one of the first global industrial companies announcing it would become carbon neutral by 2030. It met its intermediate goal, to reduce C02 emissions by 50%, in 2020. Equally important, it partners with its 650,000 suppliers to reduce their emissions.
Commercial buildings’ HVAC units are responsible for over 40% of their total energy use. Smart plugs, voice-activated air-conditioning controllers, smart thermostats and other IoT-based smart building software can reduce operating costs and greenhouse gas emissions.

Fully capitalizing on IoT in the environmental space will require businesses to overcome a long tradition that no longer makes sense of hostility toward environmental regulation.

Environmental regulation earned a reputation as an imposed burden due to primarily prescriptive regulations telling companies what technology they must use, discouraging any innovative new technologies that might achieve those goals in a less-costly fashion and not considering a possible how being more environmentally responsible might benefit a company’s bottom line..

Getting beyond that perception using emerging technology is increasingly vital in an era when every company will be required to substantiate tangible steps they are taking to reduce environmental impacts and build sustainability.

For example, the CERES Foundation, a leading organization of Fortune 100 companies committed to reducing their environmental impacts, reports that a growing number of capital sources now demand that companies document not only the emissions from their own facilities, but also “Scope 3” emissions—those from their supply chain and other parts of their value chains. Investors are recognizing climate risk. According to the New Climate Economy Report, more than 160 companies overseeing U.S. $86 trillion in assets to support the G20’s Task Force on Climate Related Financial Disclosures (TCFD). Clearly, accurate reporting of environmental impact and efforts to overcome them have become a mainstream corporate priority.

Conceivably, once companies are confident enough both in the data and in their response to it to optimize production, that data could also be released to the public, media and regulators in near-real-time, winning confidence that companies really are serious about waste reduction (sort of a “don’t trust us, track us” strategy).

Along those lines, there’s even a proposal that we might someday switch to IoT-based “real-time reporting” regulatory regimes. Sustainability consultant Gil Frend of Natural Logic, Inc., who proposed it, said benefits might include:

Lower costs for both regulated companies and regulatory agencies, through reduced paperwork and labor
More accurate data, available with less lag time from event to analysis
More readily analyzable data, enabling managers and regulators to watch trends and catch exceedances and excursions quickly—and often automatically
Performance benchmarking that can drive continuous improvement from the ground up—since the existence of better performance is proof that it is possible

Interestingly, companies that make IoT sensors to measure environmental hazards such as CO2 don’t really capitalize on the potential market for public reporting.

Nick Mecham, a vice president at sensor company Monnit, says that most of his company’s clients don’t cite environmental reporting as a priority in choosing its devices: they’re focused on improving efficiency. One client, a five-star resort, was interested in documenting its emissions reductions to attract eco-conscious guests. The resort installed Monnit’s Alta wireless sensors in its central plant, housing chiller, cooling tower and pump to monitor power use, vibration and environmental conditions. Results included:

Immediate cash growth, with significant savings in the first year
Improved net operating income (NOI)
Total energy bill reduced by 8%
Lifetime carbon reduction of 1,789 tons, the same as avoiding the use of 4,142 barrels of oil.

The International Energy Agency (IEA) reported that, instead of making progress during 2021 toward the UN’s interim goal of reducing emissions 43% by 2030, global energy-related carbon dioxide emissions rose by 6%, to 36.3 billion tons, the highest-ever level. This year’s numbers are likely to be worse because of fallout from the war in Ukraine. Given that, companies that use the IoT and other measures to cut emissions and improve efficiency have a new incentive: their own survival.

W. David Stephenson is CEO of Stephenson Strategies (Millis, Mass.), a consultancy specializing in applying the Internet of Things (IoT) to sustainability and creative approaches to aging. An IoT thought leader, he wrote The Future Is Smart (HarperCollins), one of the first guides to IoT strategy.