How telecom companies can effectively decarbonise operations

Switching a network to run on renewable energy cuts Scope 2 emissions.

Telecommunications companies can decarbonise operations by using a marginal abatement cost curve (MACC) to prioritise the available levers based on their specific cost and potential.

According to a McKinsey report, a European telecom operator said it could reduce Scope 2 emissions by 95% and Scope 3 emissions by a quarter with a 5% uplift in earnings before income taxes, depreciation, and amortisation through the MACC.

Moreover, switching a network to run on renewable energy cuts Scope 2 emissions, and can typically cut the total carbon footprint by up to 20%. On-site generation is another option for telecom locations with sufficient local clean-energy resources.

Companies can also achieve up to 30% energy cost savings by combining technology solutions, site and equipment optimisation, energy storage, pricing, and operational levers.

Installing fiber cables is another lever, as they are two to three times more energy efficient than legacy copper cables. Telefónica, which replaced copper with fibre, saved it 208 gigawatt-hours and avoided 56,500 tons of CO2 emissions.

Further, network sharing can reduce both costs and emissions to cut up to 10% of total emissions, primarily from Scope 3. It can reduce materials used by more than 30% whilst delivering the same network quality.

Lastly, using lower-emission materials for network construction and devices can directly reduce Scope 3 emissions but requires a deep understanding of the supply chain and future demand.