Green Commitment

Corporates turn to renewables to reduce their carbon footprint

With digitisation touching almost every aspect of life, industry is facing a virtual data tsunami. Data centres, physical as well as cloud based, are coming up everywhere to meet the growing demand for data storage. These data centres are huge consumers of power, with a typical data centre consuming as much electricity as a small town. For instance, a single $1 billion Apple data centre planned to be set up in Athenry, Ireland, is likely to consume 300 MW of electricity or over 8 per cent of the national capacity, which is equivalent to the daily power consumption of Dublin. It would require 144 large diesel generators as backup when wind, which will be the primary source of powering this data centre, is not available.

With the volume of data growing at an unprecedented rate, the power requirements for running large server farms is only likely to grow. As per Berkeley Laboratory’s 2016 report for the US government, data centres in the US, which held about 350 million TB of data in 2015, could require over 100 TWh of electricity a year by 2020. This is equivalent to the power generated by nearly 10 large nuclear power stations. Similarly, data centre capacity is skyrocketing in Europe and Asia with London, Frankfurt, Paris and Amsterdam adding nearly 200 MW of power consumption in 2017.

While the traditional data centres are now being replaced by advanced data centres, which have come up with efficient and innovative power solutions, the growing share of these facilities in global carbon emissions has brought them into focus. Large corporates (including handset manufacturers) that are driving this data deluge and the providers of data storage cannot ignore the increasing threat of climate change. The good news is that a growing number of companies are now realising their responsibility and are moving aggressively to meet their power consumption requirements through renewable energy.

The following are the renewable energy initiatives taken by three large global corporates – Apple, Amazon and Google – which are driving significant growth in the data and data centre markets. In fact, these companies have recently made significant (in some cases 100 per cent) renewable energy commitments.

Apple

Apple carried out assessments to ascertain its carbon footprint and realised that its manufacturing operations contribute to about 77 per cent of its total carbon emissions. Hence, the company launched the Supplier Clean Energy Program in October 2015, wherein it asked suppliers to install 4 GW of renewable energy capacity cumulatively by 2020. In 2016, almost 100 per cent of the electricity used for powering its data centres, and 96 per cent of the electricity used by Apple’s offices and facilities worldwide came from renewable energy sources.

As of October 2017, at least 14 suppliers committed to using 100 per cent clean energy for manufacturing Apple products, resulting in 1.5 GW of additional clean energy capacity. These suppliers include Biel Crystal Manufactory, Lens Technology, Catcher Technology, Solvay Specialty Polymers, Compal Electronics, Sunwoda Electronics and Ibiden. In addition, Apple has set up 485 MW of wind and solar projects across six provinces of China to mitigate greenhouse gas emissions in the generation of electricity.

Some of these suppliers have already begun implementing their clean energy plans with support from Apple. For example, Compal Electronics, which manufactures iPads, is planning to set up a 12 MW onsite rooftop solar unit in China. Meanwhile, Ibiden, which provides integrated circuit substrates to Apple, is setting up a 12 MW floating solar unit in Japan. Biel, which supplies glass to Apple, is installing a 5 MW rooftop solar system onsite and has plans to install a 100 MW off-site renewable energy system in the future. Solway has also committed to 100 per cent renewable energy across 14 of its manufacturing units including the facility in India. It is also planning to set up a 70 MW solar farm in South Carolina, USA.

Further, Apple is in the process of setting up its own green utility company for meeting its power requirements through clean energy. This move came after the company received a federal designation, which allowed it to form Apple Energy LLC, a wholly owned energy subsidiary to sell electricity in 2016. In one of the largest clean energy contracts, Apple will be buying about 50 per cent of the power generated from a 280 MW solar farm, California Flats, which is being developed by First Solar. Apple has issued two green bonds so far, one worth $1.5 billion in 2016 and the other worth $1 billion in 2017. Apple’s new campus, Apple Park, which opened in 2017, is powered almost entirely by renewable energy and has a 17 MW rooftop solar plant.

Google

Google has pledged to use 100 per cent renewable energy for all its operations. The company began investing in renewable energy in 2007, with the installation of a 1.6 MW solar pilot project at its headquarters. It started a subsidiary company in 2009, Google Energy LLC, to produce and sell clean energy and reduce the cost of energy consumption.

In 2010, it received approval from the Federal Electricity Regulatory Commission (FERC) to buy energy directly from wind and solar generators. During the same year, it invested around $38.8 million in two wind farms with a total capacity of 169.5 MW in North Dakota. Google has a 20 per cent stake in these wind farms developed by NextEra Energy Resources, and it buys around 114 MW of power from the latter’s Iowa wind energy farm. Apart from this, Google has invested about $580 million in SolarCity, a subsidiary of Tesla, which specialises in solar energy services.

Google has power purchase agreements (PPAs) in place for around 3 GW of projects, and its cumulative investment in renewable energy reached $3.5 billion as of December 2017. In 2015, the company joined the RE100 campaign and signed the American Business Act on Climate Pledge. It signed PPAs for 842 MW of renewable energy projects in 2015. In 2016, Google signed PPAs with renewable energy power producers for an additional 598 MW of projects. In the same year, it formed a consortium with three leading Dutch wind power companies, AkzoNobel, DSM and Philips. Once the projects are online, the consortium will purchase 136 MW of power from two wind farms in the Netherlands. Thus, by 2016, Google was meeting 57 per cent of its energy consumption through various renewable energy deals. As a result, the company achieved net zero annual carbon emissions. Moreover, it signed contracts for procuring 535 MW of wind power renewable energy certificates from three wind farms located in the US in December 2017. This helped the company in offsetting 100 per cent of its energy usage through renewable energy by end-2017.

In 2016, Google received the Green Power Leadership Award in direct project engagement from the US Environmental Protection Agency.

Amazon

As of October 2017, Amazon was one of the leading non-utility corporate purchasers of renewable energy in the US with more than 1.22 GW of power purchased from renewable energy projects. It has a long-term goal of installing rooftop solar systems at 50 of its fulfilment centres by 2020, while the short-term plan is to have rooftop solar systems at 15 fulfilment centres that will generate 41 MW of solar energy. Amazon signed the American Business Act on Climate Pledge in 2015 to support a shift towards a low-carbon economy. Amazon, Apple and Google signed the legal brief in 2016 to support affordable clean energy for their consumption as well as promote the US Environment Protection Agency’s Clean Power Plan.

In 2016, Amazon announced wind and solar projects that will generate 3.6 million MWh of renewable energy annually. In October 2017, Amazon commissioned a 253 MW wind farm in Texas, its largest wind farm to date. The farm is likely to generate around 1 million MWh of wind energy annually. With this, the company has set up a total of 18 wind and solar power projects, with 35 additional projects at the development stage. Amazon Web Services (AWS) has a long-term goal of using 100 per cent renewable energy for its global operations, of which it had achieved 40 per cent by end-2016.

AWS has announced the construction of 10 renewable energy projects that will generate about 2.6 million MWh of energy annually for powering the electric grid that supplies power to its data centres in Ohio and Virginia. These projects include a 189 MW wind farm in Ohio and a 100 MW solar farm in Virginia. Amazon is also planning to build two data centres in Dublin, Ireland entailing a cost of $1.56 billion, both of which are expected to use renewable energy.

The renewable energy initiatives taken by these companies bode well for the sector as a whole since they provide a promising business opportunity for manufacturers and developers alike.

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