Artificial Intelligence and emerging digital technologies in the energy sector

Abstract

Digitalization is an increasingly important direction of energy innovation moving forward. Nevertheless, which emerging digital technology is more crucial during the energy sector transformation stays underexplored. Using a near-universe of online job postings data collected between 2010 and 2019, we show that among the emerging digital technologies (i.e., Artificial Intelligence, Big data, Internet of Things, Robotics, Blockchain technology, and Cloud computing), Artificial Intelligence is the most widely adopted in the energy sector. We further calculate a systematic measure of the emerging digital technology intensity in job skill requirements and show that Artificial Intelligence proves to be the most valuable in the energy sector, either from the employee’s or the employer’s perspective. Particularly, Artificial Intelligence brings the highest wage premium to the average wage of the adopted energy firm and the local labor market. Meanwhile, Artificial Intelligence contributes the most to energy firms’ performance. Our findings suggest that energy firms should intentionally increase the requirement for Artificial Intelligence in hiring new talents. Our findings also indicate that major energy firms should take the leading role in adopting the emerging digital technologies to enjoy the predominant advantage as early as possible.