Industrial efficiency, climate risk modeling and power grid management offer the clearest near-term opportunities.
According to a report by Boston Consulting Group, Temasek and GenZero, artificial intelligence could generate around US$600 billion in annual global value in climate and sustainability by 2028.
The report says the opportunity will come from increased efficiency, cost savings, new revenue and improved asset utilization through the deployment of AI across more than 40 subsectors.
The report said that AI and sustainability are increasingly linked through resource efficiency, and that AI can help companies use less energy and materials, reduce waste, and improve financial returns at the same time.
Five priority subsectors account for approximately USD 423 billion of the estimated opportunity. These include industrial equipment and systems efficiency, climate risk modeling, grid, storage, and system flexibility management, comprehensive education, and materials discovery.
Efficiency in industrial equipment and systems presents the biggest opportunity, approximately US$300 billion. AI applications in this field include predictive maintenance, process optimization, energy management, quality control, scheduling, workplace safety, and more.
The report estimates that deploying AI across industrial systems could reduce Scope 1 and 2 emissions by approximately 0.6 gigatonnes per year.
Climate risk modeling has the potential to generate approximately $75 billion in annual value by improving hazard intelligence, asset-level risk analysis, and portfolio climate stress testing. These tools can help businesses reduce disruption costs, improve insurance prices, and support climate resilience planning.
Grid, storage, and system flexibility management could generate approximately USD 32 billion in value annually as AI helps improve predictive maintenance, reduce renewable energy use, and support grid reliability.
The report says this opportunity spans the full range of private capital, including venture capital for AI-native startups, growth capital to scale platforms, buyouts of existing companies integrating AI, and infrastructure capital for assets such as power grids, storage systems, water networks, and data centers.
Companies that adopt AI are expected to capture much of the value through reduced costs, improved asset performance, and new revenue. AI solution providers are expected to capture a smaller share (estimated at 15% to 25%) through subscriptions, licenses, and performance-based agreements.
However, the report notes that adoption can be delayed by the complexities of incorporating AI into real-world systems, including the need for domain-specific data, integration with traditional infrastructure, operational expertise, and change management.
