Editor's Note:Sammy Lakshmanan is the leader of PwC's sustainability business, leading the consulting firm's digital and AI-enabled sustainability practices.

The rapid evolution of artificial intelligence is redefining how industries operate, and its impact on sustainability is no exception. According to PwC's2025 AI Business Predictions, AI will become a value engine and key enabler for sustainability. AI can help companies address investors' top priorities, such as reducing carbon emissions, building resilient supply chains, and advancing renewable energy adoption—while balancing growth strategies, meeting regulatory requirements, and mitigating climate risks.

To unlock AI's value, companies can align AI initiatives with sustainability priorities, improve data collection to gain meaningful insights, and proactively manage AI's own environmental footprint. The returns on such investments may include: sustained business outcomes that balance sustainability with growth and profitability, informed decisions that support compliance, and accelerated progress toward a low-carbon economy.

Investor sentiment underscores the urgency of getting this right. PwC's 2024Global Investor Surveyfound that 64% of investors support increased spending to reduce carbon emissions, and nearly three-quarters of investors prefer to prioritize investment in companies taking tangible climate action, such as innovative products (77%), strengthening supply chains (80%), and scaling renewable energy (72%). Combining these efforts with AI can help companies improve efficiency, uncover opportunities, and deliver measurable results.

AI Accelerates the Energy Transition

AI has the potential to radically transform energy systems, changing how energy is produced, distributed, and consumed. Companies can leverage AI-driven insights to optimize renewable energy integration, improve grid performance, and reduce waste. For example, energy providers are using AI to fine-tune wind farm operations, while agricultural companies are leveraging AI to enhance energy efficiency in irrigation and storage processes. These applications highlight how predictive analytics can provide more accurate energy demand forecasts, enabling industries to allocate renewable resources such as wind and solar more effectively.

Beyond advancing decarbonization goals, real-time energy optimization through AI systems can lower operational costs, reduce risks from energy market volatility, and provide companies with a competitive advantage in the transition to renewable energy. Companies that strategically deploy AI in energy management can enhance efficiency while also strengthening their market position.

In manufacturing, for example, companies are using AI to optimize energy-intensive operations such as smelting and assembly lines, improving efficiency while reducing emissions. Similarly, the hospitality industry is adopting AI-driven smart building technologies to cut energy use, highlighting AI's versatility in driving sustainable practices. By accelerating the adoption of cleaner energy solutions, AI is providing companies across industries with the tools to achieve sustainability goals while optimizing costs and operations.

AI Simplifies Compliance Processes

As sustainability regulations evolve—driven by frameworks such as the EU's Corporate Sustainability Reporting Directive—AI is becoming a critical compliance tool.

AI can generate content, such as assisting in drafting qualitative disclosure documents, and recommend risk control measures under human oversight and a human-led approach. Additionally, AI can automate data collection, integrate data from different sources, and assist in generating audit-ready sustainability reports, which can significantly reduce the time and cost of compliance.

Beyond reporting, AI can uncover insights from large datasets to inform sustainability strategies. For example, it can identify opportunities in the value chain by analyzing data beyond direct Tier 1 suppliers and detect trends such as emissions hotspots across multiple tiers.

By investing in AI tools that provide actionable insights and streamline compliance processes, companies can go beyond mere regulatory compliance to achieve greater efficiency and operational excellence.

AI Drives Strategic Decision-Making

AI's true power may lie in its ability to integrate sustainability data into strategic decision-making.

By providing real-time insights, AI can help business leaders make informed choices about energy investments, supply chain optimization, and long-term sustainability initiatives. Furthermore, AI makes sustainability data more accessible through intuitive natural language interfaces, enabling operators and non-sustainability professionals to engage in complex scenario analysis. It can also unlock new value by quantifying opportunities such as the commercial potential of low-carbon products, helping companies align sustainability goals with profitability and growth.

This strategic focus is reflected in PwC's 2024Cloud and AI Business Survey, which showed that 63% of top-performing companies are increasing cloud budgets to leverage generative AI, while 34% indicated that sustainability considerations are driving these expected budget increases. These investments demonstrate that AI is not only a tool for innovation but also a key enabler for achieving sustainability goals.

Looking Beyond 2025: Building a Sustainable AI Future

Looking ahead, continued growth in computing power and the proliferation of renewable energy are likely to make AI more accessible and transformative.

By strategically adopting AI tools—whether to enhance energy efficiency, meet compliance requirements, or optimize supply chains—companies can position themselves as leaders in the future sustainability-driven economy. Companies that act now will be better equipped to meet rising investor expectations while delivering measurable results and driving sustained business outcomes.