AI, AIoT & ESG

There is vast potential for AI, 5G and the Metaverse to be applied towards advancing the Environment, Social and Governance (ESG) cause, including Sustainability.

Our global economy is facing challenges and the tragic warfare in Ukraine has had consequential impacts on energy supply for much of Europe and beyond.

Indeed, McKinsey forecast that $275 Trillion may have to be spent in the period to 2050 (ranging from circa 7% to 9% of global GDP) to achieve carbon next zero.

The challenges facing our political and business leaders and indeed society in general are as follows:

• The risk of catastrophic and irreversible consequences of human made climate change over the next decades;
• Driving economic growth and improving living standards (including social objectives such as healthcare and education) in a manner that does not further climate change
• Linked to the above points – how to achieve net carbon zero whilst continuing to improve living standards and meet social and economic needs;
• The immediate challenge to deal with diversification of energy supply by scaling renewable energy and battery storage following the abnormal activity and pricing in the gas sector;
• A period where technology is advancing ever more rapidly and scaling across our every day lives with standalone 5G networks and AI combined with IoT (AIoT) likely to be pervasive across our cities and homes in the next few years  the need for governance and ethics becomes key;
• The above point will be compounded by the arrival of the Metaverse and AR Glasses. The reality is that innovation in the smart mobile phone is approaching its limit with more incremental improvements (marginal improvements in cameras, etc) relative to transformational and revolutionary change that occurred as the internet emerged in the 1990s to early 2002s  and the arrival of the iPhone with rival smart phones responding.
• Headsets (Virtual Reality, VR) and Augmented Reality (AR) or Mixed Reality (MR) glasses are likely to radically transform the user experience and take off as standalone 5G networks (as opposed to the networks relying on 4G infrastructure for 5G services) take off around the world over the next one to two years;
• AI Technology is becoming increasingly user friendly and relevant with the likes of Transformers with Self-Attention for language and multimodal multitasking vision plus language tasks) as well as the arrival of Generative AI that will play a key role in content creation for the Metaverse whereby the user may user may apply words to describe an item and the AI will generate a 3D version. In fact researchers have set out that they may enable this into Unity code (Unity along with Unreal Engine being the main code framework for the Metaverse in terms of VR or AR).

The Strategic Dimension

There is a strategic imperative for the EU, UK and the US (following the adoption of the Inflation Reduction Act in 2022) to push for accelerating the scaling and adoption of renewable energy and advancing battery storage technology at a time when action on Climate Change is a high priority and also the need to diversify energy supplies is growing. AI technology may play a key role in helping scale these areas.

Source for Image above IIman Ghosh, Visual Capitalist 

Advancing AI, IoT (AIoT) alongside standalone 5G networks may serve as an engine of economic growth whilst also enabling the ESG objectives ranging from scaling up our response to climate change and also scaling social objectives such as healthcare, education and increasingly employment.

Source for Image Above Iman Ghosh Visual Capitalist

PWC in a report commissioned by Microsoft set out that AI applied to four sectors of the economy (energy, water, agriculture and transportation) could deliver the following by 2030:

• 38.2m net jobs gain;
• A reduction fo emissions of Green House Gasses (GHGs) amounting to 2.4Gt or 4% of the global total;
• Add 5.2 Trillion USD or 4.4% of GDP to the global economy.

Furthermore, BCG analysis sets out that advanced 5G networks may create 4.6m jobs ands add $1.7Trillion to the US economy alone. In addition, the US EPA set out that 5G via advancing ICT solutions may contribute to a 1.34Bn tonnes reduction in CO2. emissions in the US alone due to advancing ICT solutions in part due to reduced travel needs.

Moreover, there are regulatory drivers across the EU, UK and potentially emerging in the US for mandatory ESG or Corporate Social Responsibility and Sustainability) reporting obligations. At DLS we apply Natural Language Processing (NLP) to assist and enable firms and investment funds to classify and assess other firms that they may be dealing with (or investing into) across the spectrum of ESG including the social and governance aspects.

ESG Mandatory Reporting Obligations & Scrutiny

It is important for firms and funds to understand that when engaging with ESG they will be scrutinised by the NGO community and regulators and hence if the purpose is simply ESG for PR without substance (Greenwashing) then this is likely to result in adverse consequences and negative publicity. Rather by investing in genuine ESG practices, firms may build trust and better services (or products) that meet the needs of a fast growing sector of the economy whereby sustainability and standards matter.

Furthermore, we work with cutting-edge AI for time-series using Transformer models with self-attention mechanism to forecast renewable energy generation and outperform the previous state-of-the-art models such as Long Short Term Memory (LSTM) Deep Neural Networks and Random Forest Machine Learning algorithms.

It is important to recall the “S” and “G” aspects of ESG too. From the Social perspective we are committed to helping develop both the social connectivity element in a non toxic environment and social development goals such as educational potential of technology and preventative healthcare. Furthermore, on the governance side we adopt best practice principles based standards and aim to provide a personalised engagement that does not require data harvesting at scale (providing data privacy and security) by application of Federated Learning with Differential Privacy.

Our focus is to enable the scaling of green energy financing and carbon reduction for enterprises whilst also allowing firms to engage and show their customers what they are doing to meet their ESG obligations.

Our vision and view is that the mobile phone is almost as advanced as it likely will be. Whilst incremental improvements may still occur, the next big innovations will be via headsets (VR) and glasses (AR and Mixed Reality or MR) that we collectively define as the Metaverse (Extended Reality, immersive and crucially interactive).

However, our platform is built to operate in both the mobile and glasses (Metaverse and AR) environments.

When one considers the Metaverse one is often thinking of 3D and the immersive side, however, it is important to also recall that the Metaverse environment will also be interactive with AI agents prodiving a highly personalised engagement for the user.

A key difference with the mobile (or desktop) applications of today is that the AI-enabled Metaverse platforms will be responsive to the user with voice or gesture based engagement and respond to questions and instructions from the user rather than the current plaforms whereby the user is really just consuming the same content as everyone else.

In our world a fund manager could view a wind or solar plant in 3D, walk around it, view the financial projects and ask due diligence questions in relation to a green bond issuance or green equity financing (we tokenise these with  customised Solana blockchain tokens, a carbon neutral solution) . A company could show a 3D version of a tropical rain forest or coral reef it has invested and tokenised the carbon side to demonstrate they are protecting (in accordance with NGO approved standards such as the Gold Standard or VERRA) and invite its customers to explore the space and whilst there are those who state that experiencing the rainforest or coral reef in person is better than doing so in an extended reality setting, 1 billion or more people transcending on such natural assets in the real-world would have highly negative consequences so we can open up the beauty of our world and natural assets virtually and allow the global population to explore and perhaps gamify the experience for social connectivity.

Our platform also features an AI powered virtual concierge that applies Neural Translation to remove language as a barrier and connect the user to EV private car hire services and creates an itinerary for the user to engage in their leisure activities (restaurants, bars, shopping) connecting them back to brands that promote sustainability values via an immersive and interactive setting.

We look forward to collaborating with others on this journey and demonstrating the potential for advancing AI technology to be applied in a manner that both creates value with sustainable development for sponsors and investors and also focuses on scaling action to mitigate climate change and the entire set of values for ESG (including the social and governance aspects).