Questions and answers on the 2022 Strategic Foresight Report

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  What is strategic foresight and how does it support the EU's policymaking?

Strategic foresight is a systematic approach to look beyond current expectations and explore plausible future developments. Its aim is to identify policy implications for the present. Using a range of methods, such as horizon scanning, megatrends analysis and scenario planning, the von der Leyen Commission has started to embed strategic foresight across its major initiatives, in support of the EU's political agenda. Ultimately, this anticipatory governance helps us future-proof our policies.

Annual Strategic Foresight Reports are the flagship products of the Commission's strategic foresight agenda. Their objective is to heighten policymakers' awareness of long-term trends, as well as of less noticeable phenomena that have a significant potential to impact the EU and the world. The increased awareness allows for catered solutions to address related opportunities and risks. The foresight agenda subsequently informs the Commission's Work Programmes and the multiannual programming.

The 2022 Strategic Foresight Report looks at the long-term interaction and reciprocal reinforcement - what we call ‘twinning' - between the digital and green transitions in the current geopolitical context (most notably, with regards to Russia's military aggression against Ukraine).

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  What are the key takeaways of the 2022 Strategic Foresight Report[1]?

There are four important takeaways from this year's report:

First, it identifies synergies and tensions between the twin transitions. Digital technologies can play a key role in achieving the EU's climate neutrality by 2050 and help restore biodiversity. However, the increasing use of digital technologies will increase energy consumption and the amount of electronic waste. Pursuing the green transition will also transform the digital sector. Towards 2050, its increasing energy needs should be further covered by fossil-free sources, such as renewable hydrogen.

Second, it highlights the critical role of digital technologies in greening the EU's five vital and most greenhouse gas emitting sectors, namely: energy, transport, industry, construction and agriculture.

Third, it outlines the different geopolitical, social, economic and regulatory factors that will affect the twinning in the run up to 2050. Russia's military aggression against Ukraine confirms the need to accelerate the twin transitions and reduce our strategic dependencies. Securing in the long term sustainable access to raw materials will be of utmost importance. Technological competition could also rapidly increase. While this will strengthen the EU's democratic model and spur further innovation at global level, it may also pose risks related to cybersecurity and disinformation. The role of the EU in shaping global standards will remain key, but achieving the twinning will also require fairness (most notably on up- and re-skilling opportunities) being at the heart of both transitions. The EU will also need to adjust its economic model towards greater wellbeing, sustainability and circularity.

Finally, taking into account the new geopolitical context, the report identifies ten key areas of action for the EU to ensure the successful twinning of the green and digital transitions by 2050 (see press release).

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  What is ‘twinning' and what are its objectives?

Twinning refers to the interplay between the green and digital transitions, and more specifically their capacity to reinforce each other. For instance, until recently, the digital transition progressed with only limited sustainability considerations.

Better understanding their interaction is key to maximising their synergies and minimising their tensions. This is essential in the current geopolitical context, where the EU aims at accelerating both transitions and at strengthening its resilience and open strategic autonomy.

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  How is the new geopolitical context related to the EU's twinning objectives?

The long-term implications of Russia's military aggression against Ukraine, including for energy, food, the economy, security, defence and geopolitics, will clearly affect Europe's path to achieving fair green and digital transitions. This confirms the need to accelerate the twin transitions, reinforcing the EU's resilience and open strategic autonomy.

While cutting our dependency on Russian oil and gas, the current context also highlights the urgency to reduce other strategic dependencies. For instance, the EU's dependence on third countries, including China, in the area of critical raw materials is currently even greater than our dependence on Russia's fossil fuels.

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  What are some of the concrete synergies and tensions observed in relation to the twin transitions?

There are many examples of positive synergies between the green and digital transition, particularly in sectors that are vital for the EU's economy. For instance:

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  More circular business models will help reduce electronic waste and reduce the EU's dependencies on third countries for critical raw materials. According to industrial estimates, recycling could be the EU's major supply source for most transition metals after 2040.
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  By measuring and controlling inputs, and with increased automation, technologies like robotics and the internet of things could improve resource efficiency and strengthen the flexibility of systems and networks.
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  Digital technologies could play a key role in achieving climate neutrality, reducing pollution, and restoring biodiversity. For example, personal monitoring of pollution exposure or contribution and access to environmental data through networks of micro-sensors and smart devices will empower people in their choices.
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  Data sharing or gamification can increase public participation in steering the transitions and co-creation of innovations.
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  Pursuing the green transition will transform the digital sector. For example, achieving climate neutrality and energy efficiency of data centres and cloud infrastructures by 2030, including by meeting their electricity demand with solar or wind energy, will support the greening of technologies, such as big data analytics, blockchain, or the internet of things.

However, there are also areas where the two transitions could negatively affect each other. These are identified as tension points. For instance:

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  The energy consumption could increase if digital technologies do not become more energy-efficient. ICTs are responsible for 5%-9% of global electricity use. This could grow as the use of blockchain, internet of things, platforms, search engines, and virtual reality applications increase.
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  The greater use of digital technologies could increase electronic waste and its environmental impact. It could reach 75 million tons by 2030.
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  The green and digital transitions will require more raw materials. For example, the use of lithium in the EU, mainly in batteries, is projected to raise by 3500% by 2050. However, their extraction, mining and processing can also be damaging for the environment and water security. This can also raise ethical concerns. This being said, the EU and its Member States already have a good legislative framework in place to ensure that mining takes place under environmentally and socially sound conditions.

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  What about economic and social factors? How important are they for the twinning?

Economic and social factors are paramount for a successful twinning in the run up to 2050. If technology is a pre-requisite for twinning, the green and digital transitions need to be fair, inclusive and affordable for all. This will require active labour market policies, adjusted social protection and welfare systems, as well as adequate compensation for citizens and businesses facing costs related to the transition.

The transitions will also require additional private and public investment. The additional private and public investment needs for the twin transitions could amount to nearly €650 billion each year until 2030. In the current geopolitical situation, additional investments will need to take into account the risks related to increasing public debt, a potential shift in financial priorities and an overall uncertain economic outlook. Against this backdrop, economic policies need to be adapted to steer additional investment into technologies supporting the twinning.

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  What about the focus of the previous and next Strategic Foresight Reports?

The three editions of the annual Strategic Foresight Report follow a logical sequence.

The 2020 Strategic Foresight Report focused on resilience across four dimensions: green, digital, social and economic, and geopolitical.

Building on this last one, the 2021 report focused on the EU's open strategic autonomy as part of the geopolitical dimension of resilience. It was particularly timely in view of the ensuing geopolitical turmoil.

Next year's report should focus on key upcoming challenges and opportunities that Europe will face in the decades to come, providing strategic insights relevant for strengthening the global role of the EU.

[1] The translated versions of the 2022 Strategic Foresight Report will be available as from 20 July 2022 in all EU official languages.