Digi & Green Economy

Interactions between the process of digitalization and the transition to a green economy

Green economy is the model for an environmentally compatible economy, which has positive links between ecology and the economy, and increases social welfare. Green economy means that the economy develops within ecological guard rails based on underlying environmental goals. Despite the debate surrounding the guiding principle of sustainable development that has been going on for more than two decades, its principles are still far from becoming widely established in the economy and society. Transformation towards a green economy goes beyond technical eco-innovations and implies a transformation in the structure of institutions and mechanisms at multiple levels (corporate, sectoral, among consumers), and is characterized by path dependencies, feedback loops, and breaks.

At the same time, the increasing availability of digital data, networking, automation and new user interfaces are transforming business models and restructuring entire industries. Digitalization is fundamentally changing the way we do business, live and work, and is progressively penetrating every area of the economy and life. It has already progressed so far that things are now being realized that were once only visions, such as artificial intelligence (AI), the internet of things (IoT) or digital platforms.

This blurring of the fields and applications of ICT is taking place with unusually high innovation dynamics and diffusing rapidly so that digitalization can be seen as the main motor driving technology and social change in the modern age. Many future manifestations of digitalization with regard to the green economy and sustainability are still unclear at present, although they can be shaped in principle.

In view of the increasing blurring of digitalization, there is a need for environmental and climate policy to observe the major digital trends, understand their combined effects and employ a suitable practical approach to classifying the developments in policy arenas. The actors involved are only just starting to consider the outlined developments of digitalization and the green economy not as separate events but rather to focus on their joint analysis. This is precisely what this project aims to do based on selected examples.

This project will take up and analyze intersections between Germany’s required development towards a green economy and increasing digitalization. Based on these intersections, recommendations are developed for changes to framework conditions that are related to environmental protection. Issues concerning how we handle data affect all the work packages equally, because all the applications have to be compatible with data protection. To some extent, data should also be understood as a control function for both individuals and organizations. Deliberately including the topic of data in the ecological sustainability discussion makes it possible to link the debates and studies on “digitalization for sustainability“ on the one hand with “sustainable digitalized societies“ on the other, which have largely taken place separately so far.

The project will compile areas that are already using big data and e.g. AI applications based on this for environmental protection, other possible applications that have not yet been used, and existing obstacles that hinder application. On this basis, proposals are developed for regulations to remove the obstacles to big data applications in environmental protection. These proposals will include those already discussed for data ownership and data protection as well as considerations concerning competition-specific and legal aspects.

In addition, the potentials of digitalization for the green economy will be illustrated using selected digital technologies. Applications are examined that are already being used for the green economy, especially artificial intelligence and digital platforms. Furthermore, the obstacles to fully exploiting these potentials are identified, and individual example applications examined in more depth.

The project will also focus on the digitalization of rural areas. The first step is to identify the main interfaces between the Commission’s recommendation for “equal living conditions“ and the topics of digitalization and environmental protection. From this, initial measures will be developed based on a national and international analysis of best practices. The second step is perform an obstacle analysis for these measures. The third step then develops proposals for instruments to strengthen rural areas and for environmental protection that especially consider the potentials of digitalization.


01.06.2020 - 31.01.2023


  • Federal Environment Agency


  • Fraunhofer Institute for Experimental Software Engineering (IESE)
  • Institute for Ecological Economy Research IÖW