In this thought-leadership article, Pavlos Sideris, Director of Double Up Media, talks about the increasing impact that environmental responsibility will have on the online casino sector, notably around the ESG framework and energy consumption.
The online global gambling market is worth $88.65bn in 2023; it has a compound annual growth rate of nine per cent, and slot games are the most popular product at online casinos. It’s a massive industry, and like all major industries, it has a growing environmental responsibility.
In recent years, as the climate crisis has grown ever more pressing, stakeholders in the casino and slot gaming industry have turned their attention to sustainability, reducing their carbon footprint, and making environmentally responsible choices.
Many slot sites now use the environmental, social and governance framework to assess business practices and guide strategic decision-making processes. This is changing how slot sites operate internally and trickling down to more sustainable practices for players.
What is the environmental impact of online slots?
The exact environmental impact of the online slots and casino industry is unknown. While the Gambling Commission and other actors collect data on revenue, costs, tax, number of players, gambling behaviours, and other areas, environmental metrics are not currently used to assess the industry’s impact.
While it’s accurate to say that online casinos reduce the carbon footprint of physical casinos, the widespread nature of online players, plus the lack of accounting and collection methods, has made it difficult to calculate the energy consumption of the entire industry.
However, research from the USA details that the servers, data centres, and networks that are instrumental in running online slot sites and other industries account for 1.8 per cent of the country’s energy use. Worldwide, this is expected to increase to two per cent, equivalent to the aviation industry in terms of carbon footprint.
As the popularity of online slots and gaming increases and the drive for ever-better graphics and more impressive games and platforms continues, this energy consumption is expected to rise, with the World Economic Forum predicting it will reach 14 per cent of the world’s total emissions by 2040.
On top of the carbon emissions created through energy consumption, the environmental impact of slot sites also includes electronic waste produced by the industry as older technologies are upgraded and replaced.
ESG: the future-proof strategy to success
Profiteering without factoring in social and environmental impact is no longer a strategy for success in today’s operating environment. Instead, online gambling businesses are integrating the ESG framework into their operations, and it’s being hailed not only as an environmental model that works but also as a future-proof strategy to guide businesses.
Essentially, ESG is a framework incorporated into a company’s business model. It enables businesses to identify and improve their social and environmental impact to become more sustainable and socially responsible companies. This is leading slot sites to incorporate several eco-friendly initiatives.
Eco-friendly power and procedures: with millions of gamblers using slot sites and online casinos daily, eco-friendly hosting is one of the most significant ways slot sites can reduce their carbon footprint. Eco-friendly hosting seeks to reduce the energy used by servers and their cooling systems, as well as changing the energy source from fossil fuel sources to renewables.
Switching to cloud storage can also be fundamental as it reduces the energy required to run online slot sites and the storage and data-processing demands needed. Additionally, engaging in good business practices such as reducing paper consumption and properly recycling electronic equipment are easy strategies to implement that can have a notable impact.
Hardware and software: some game developers and gambling platforms also reduce environmental harm by using more efficient hardware and software. For example, some pioneering slot developers are creating games with smaller file sizes, optimising graphics, and reducing the energy required when playing the game. More efficient use of software and eco-friendly game design can make a significant difference to games that are energy intensive, like live dealers and live-streamed slots.
IGT has more recently hit the headlines for championing this area, joining the Science Based Targets initiative, formally adopting a low greenhouse gas policy, and aligning with the 2015 Paris Agreement. The fact that IGT’s commitment has been publicised shows the potential for positive marketing outcomes for slot developers when aligning with green goals and environmentally friendly business practices.
Carbon off-setting and donating to good causes: responsible slot sites can engage in carbon off-setting (investing in environmental projects to balance the emissions they create), such as tree planting projects and investing in green technology through funding ecological research and development charities and bodies.
Promoting eco-friendly practices and play: slot sites can incentivise players to engage in environmentally responsible play and actions. For example, they can promote using more eco-friendly e-wallets that are powered using clean energy by offering extra bonuses when players use such methods. They can also encourage players to limit their gambling by using budgets and play time reminders, which reduces long and energy-intensive slot gaming sessions while protecting players from excessive gambling.
Role of the consumer
As the gambling industry holds vast economic power, operators can be instrumental in educating consumers to make more environmentally impactful choices and leading by example. Still, consumers have a role in creating change in the industry by deciding which slot sites they give their money to. The more consumers favour sustainability by effectively voting with spending power, the faster the industry will adapt to more eco-friendly practices to align with consumer wants.
Additionally, while not putting the responsibility on consumers, players can also independently opt for games that consume less energy, such as titles with simpler graphics, avoid live streams, use renewable energy companies to power their homes, ensure their data storage is regularly cleaned out, and recycle hardware, like smartphones while avoiding unnecessary upgrades.
