Data storage companies use a lot of energy; Where it comes from matters

The internet is far and away the biggest thing that we have ever built as a species. That isn’t to say that it’s the most important of the things we’ve built, though it’s up there. Rather, taken as one massive, interconnected machine, the internet simply dwarfs any other single thing mankind has ever created in terms of physical size. And while we rarely think about it, that machine has an ecological footprint that matches its scale.

Because our experience of the internet is almost entirely non-physical, it’s tempting to think of it as something ethereal, like a cloud. As any privacy advocate will (sometimes relentlessly) tell you, the “cloud” is just another word for someone else’s computer. Those computers take energy and resources to produce and run.

To give you some idea of the scale we’re talking about, consider U.S. servers’ total energy use in 2014: a staggering 70 terawatt hours. The U.S. used about 3,888 terawatt hours in the same year, meaning that servers accounted for just under 2 percent of all domestic electricity consumption. That might not sound like a lot, but it’s more than the entire country of Chile consumed and significantly more than the Czech Republic.

Because server farms are such large users of electricity, it matters how and where their electricity is produced. A green data industry could put a heavy thumb on the scale for the development of renewable capacity, while a data industry that isn’t constrained by such concerns could be a significant contributor to climate change.

The good news is that, as the public has become more aware of the massive electricity bills these companies are incurring, public relations concerns have led some leaders in the industry to take aggressive stances on renewably generated electricity. These and cost concerns have also led to significant increases in efficiency that have kept the total consumption by U.S. servers almost constant over the last decade despite massive quantities of storage being brought online in the same time period. The bad news is that there is a long way to go and it isn’t clear that the industry as a whole is willing to make the switch to renewables when it impacts bottom lines.


Leading the pack

Technology giants Apple and Google are now among the most energy-conscious companies in the world, according to Greenpeace’s annual Click Clean Report. Digital storage company Switch is also among the best-scoring data companies rated by the environmental advocacy group.

At the end of last year, Google announced that all of the energy used for its data centers would come from renewable sources by some point in 2017. It is able to make this promise because over the last several years it has been slowly but surely working with renewable energy producers to expand production, according to the New York Times. The tech giant signs agreements that lock it into buying renewable power from these companies, and those companies can turn around and leverage the guarantee to obtain financing that lets them build out more renewable capacity.

We are the largest corporate purchaser of renewable energy in the world,” Google’s senior vice president of technical infrastructure Joe Kava told the Times. “It’s good for the economy, good for business, and good for our shareholders.”

Using similar strategies, Apple reached 96 percent renewable energy in 2016, according to corporate sustainability reports. This includes Apple’s data facilities, but not manufacturers in the company’s supply chain, which make up the bulk of its comprehensive carbon footprint. Even so, it should be noted that carbon emissions per product have fallen to 97 kg in 2016 from 137.2 kg in 2011.

Facebook is still a little behind Apple and Google, but Greenpeace gives it credit for committing early to a high degree of transparency into its energy mix and to eventually reaching 100 percent renewable energy. The company reports that it exceeded its goal of reaching 25 percent renewable energy in 2015 and is on track to reach 50 percent by 2018. The social network’s decision to expand data centers in Texas, Ireland, and New Mexico point to a continued on environmentally-conscious growth.


Still catching up

Companies like Microsoft and Amazon are also pushing toward renewable energy, though the pace is somewhat slower. Both companies still rely heavily on carbon offsets to meet their sustainability goals, which can obscure a picture of a company that continues to draw heavily on non-renewable resources. Despite occasional stumbles, however, Microsoft is making steady strides toward a more aggressive environmental stance and Amazon may be as well.

Those who have been following data centers’ energy use for a while will likely recall Microsoft’s unfortunate showdown with local officials in Quincy, Washington. In 2006, the tech giant built a massive data center on 75 acres of land with the plan that local hydroelectric generators would feed its power requirements. Over the first few years of its operation, though, the company made heavy use of 40 ten-foot-tall diesel generators and made moves to strongarm utility officials, drawing the ire of the local community.

More recent reports suggest that those diesel generators are now used only in emergencies and that additional tax revenues and jobs have done a lot to endear Microsoft and other data companies that have moved into Quincy to local citizens.

Greenpeace notes that Microsoft has been slowly moving away from its use of Renewable Energy Credits (RECs) to achieve carbon neutrality, instead moving toward PPAs. The difference is that RECs are a property right that is created when renewable energy is generated but sold separately, whereas PPAs are sold together with the energy. In some markets, the oversupply of RECs has led to rock-bottom prices (as low as $0.38 per megawatt hour in 2015) that don’t do much to incentivize the construction of new renewable generation capacity. About 32 percent of Microsoft’s power came from clean sources in 2016.

Amazon is in just the opposite position. Amazon Web Services is far and away the biggest cloud storage provider with a 45 percent worldwide market share. Its public cloud is more than double the size of Microsoft’s, Google’s, and IBM’s combined. While it has done a lot to increase its renewable energy advocacy in recent years, the almost complete lack of transparency into its energy mix makes it a hard sell for environmentalists. AWS made a commitment to using 40 percent renewable energy by the end of last year and to using only renewable energy at some point in the future, but without transparency, progress toward these goals is hard to track.

While the signs coming out of the big five are generally encouraging, and a number of smaller players are committing to carbon neutrality, Greenpeace warns that many companies are pursuing shortcuts that won’t lead to serious change. In particular, as mentioned above, the use of unbundled RECs can help a company to present a picture that is much rosier than reality. Large East Asian companies are also a challenge that will only get larger as they grow. Even those that are committed to renewable energy face difficulty obtaining renewable energy from local monopoly utilities.

The type of energy that data companies use and the efficiency with which it’s used matter, not just for major players but for the industry as a whole. As more people come online and as the number of web-enabled sensors explodes, as it is predicted to thanks to the coming Internet of Things revolution, the demand for digital storage will rise accordingly. This storage could, in turn, provide a steady demand for renewable energy, helping to further lower prices for everyone. Alternately, the worldwide data industry could continue to use fossil fuels, delaying the switch to renewables and exacerbating global climate change. Ultimately, the choices they make will probably come down to sensible policy and pressure from their consumers.

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