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Can Green AI help shape the future of sustainability?   By Michael Chou Investment Manager

It is a well-known fact that large artificial intelligence (AI) models are presenting challenges for the environment, with the massive computational power they require leading to high electricity and water usage and negative environmental impacts.    To put this into perspective, OpenAI’s ChatGPT query demands 10 times more energy to process compared to a Google search and, given the surge in the use of AI, Goldman Sachs predicts data centre energy consumption will soar by 165% by 20301. Yet in recent times there has been an emergence of a new type of AI provider, with a focus on the deployment of systems that minimise their environmental and ethical footprint – a concept known as ‘Green AI’.   What is Green AI? Where traditional AI (known as Red AI) prioritises performance, Green AI focuses on achieving the same performance with less energy and waste, as well as solving environmental problems, such as managing smart power grids, tracking pollution and predicting potential disasters. This year Google launched a project known as Google For Startups Accelerator, backing 16 Asia-Pacific organisations applying AI to biodiversity, agriculture, carbon markets and climate resilience. Participants will receive three months of technical support, access to specialist AI models and mentorship. They include New Zealand’s, 800 Trust and Listening Lab, which is using bioacoustics to monitor biodiversity through sound, while in South Korea TelePIX is converting satellite observations into intelligence for global mangrove monitoring. There are also a number of projects focused on enabling farmers to become more efficient. Australia’s X-Centric has created portable hardware that is designed to provide immediate geochemical analysis of soil. Indonesia’s Edufarmers is providing smallholder farmers with timely guidance on pests, diseases and weather through commonly used messaging applications. Other participants in the Accelerator program are focused on the reduction of carbon emissions, including India’s Farmers for Forests, which is using AI-powered drones to measure carbon and biodiversity outcomes from smallholder agroforestry in India.   What this means for companies and investors Companies are under growing pressure to cut emissions and demonstrate environmental responsibility. Integrating Green AI may provide companies with the opportunity to improve their environmental, social and governance (ESG) outcomes, which in turn could help them to build trust with increasingly environmentally conscious consumers. Investors are also highly focused on the implications of AI use for ESG. At Uniting Financial Services, our range of ethical managed funds invest according to our Ethical and ESG Policy, which seeks to avoid companies that promote unsustainable use of ecosystems, resulting in land degradation and biodiversity loss. We also direct our investment managers to invest in companies that score well on the management of climate change, environment and waste management, and ethical conduct. Our managers frequently engage with companies on their operations. Schroders, for example, requires large and medium companies to commit to decarbonise business models towards net zero by around mid-century, as well as conducting and publishing regular climate-scenario analysis and setting carbon emissions targets. Another of our managers, Janus Henderson, recently engaged with data centre specialist, Airtrunk, to discuss its plans to enable new renewable energy capacity, including a solar farm in Malaysia and a new solar project in New South Wales, to manage its carbon footprint. What is clear is that AI is entering a new phase, which offers the potential to manage ethical and environmental risks and, with the right oversight, could lead to new and improved investment opportunities. UFS and its managers will continue to watch this space with interest. For more information on the UFS funds, visit unitingfinancial.com.au/ethical-managed-funds. The UFS funds are available to wholesale investors only. 1. Goldman Sachs: AI to drive 165% increase in data centre power demand by 2030, 2026     Important information: The Uniting Financial Services (UFS) unregistered managed investment schemes are available for investment only to wholesale investors. Prospective wholesale investors who wish to invest via our unregistered managed investment schemes can access the Information Memoranda for these any of these funds on the UFS website. While the information in this email has been prepared with all reasonable care, UFS accepts no responsibility or liability for any errors, omissions or misstatements however caused. No action has been taken to register or qualify these products or otherwise permit a public offering of these products in any jurisdiction outside Australia. Past performance is not indicative of future performance.    

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Kindly note that the information on this webpage is only intended for wholesale, professional or sophisticated investors (as defined in the Corporations Act). Please do not refer to this webpage if you are not one of these investors. Uniting Financial Services is not providing any personal advice or recommendation regarding any financial products described or referred to on this webpage. Prospective investors should make their own enquiries and should seek all necessary financial, legal, tax and investment advice. Past performance is not indicative of future performance, all information contained on this wepbage is current at the date of publication, however may be subjected to change without notice.