Among the world’s biggest tech companies, clean energy deals and climate goals have become a source of rivalry. Today, five of the top 10 technology firms worldwide by market capitalization are powered by 100% renewable electricity. However, a gap is emerging between laggards and leaders, with some of the biggest electricity consumers having the lowest share of renewable energy usage.
Digital and data solutions have an unprecedented opportunity to make a major and essential contribution to the global climate effort. Launched at the 2021 United Nations Climate Change Conference, or COP26, the Tech for our Planet challenge program highlighted how innovations, from artificial intelligence to blockchain and big data, can help the world meet net-zero targets.
But with power-hungry data centers and supply chains that span the planet, unless every tech company around the world is powered by clean energy, the industry will never be able to create climate action at scale.
Choosing a sustainable future
After coming under increasing scrutiny over the last few years over their environmental impact, leading tech giants have taken huge steps towards reducing their carbon footprint, with actions such as waste reduction, hardware recycling, and responsible supply chain sourcing. However, by far and away the most impactful aspect of these companies’ sustainability strategies is the transition to renewable energy.
Among the big hitters, Google has pledged to power its operations entirely with carbon-free energy by 2030, and since 2017 it has matched 100% of its global electricity use with purchases of renewable energy. Meanwhile, Microsoft recently announced that by 2030 it will have 100% of its electricity consumption matched by zero carbon energy purchases. It’s a similar story at Facebook, which achieved its goal of sourcing 100% renewable energy to support its global operations in 2020.
These tech companies have been able to achieve these aims by leveraging their enormous investment capacity.
In 2019, Google signed the biggest corporate purchase of renewable energy in history, with a 1,600-megawatt (MW) package of agreements that included 18 new energy deals. Today, its worldwide energy portfolio produces more electricity than places like Washington D.C. or entire countries like Lithuania or Uruguay use each year. Facebook is also one of the largest corporate buyers of renewable energy, with current contracts in place for more than 6.1 gigawatts (GW) of wind and solar energy across 18 states and five countries. And over the last 12 months, Microsoft has signed new purchase agreements for approximately 5.8GW of renewable energy across 10 countries around the globe.
But even for companies with slightly less financial firepower, going fully renewable is not only possible but in many cases can represent a cost saving. Thanks to technological advancements that have pushed the efficiency of solar installations close to their theoretical maximum – such as bifacial panels, which catch rays from both sides, and electronics that enable solar panels to track the sun as it moves through the daytime sky – harnessing the sun is increasingly cost-effective.
By 2030, the take-up of cloud computing is forecast to increase exponentially, from US$1.3bn in 2019 to US$12.5bn, according to BloombergNEF. Ultimately, renewable energy is now cheaper than fossil fuels in many markets, and because electricity is the main outlay for tech firms, by using solar or wind power, they can keep costs down even as demand for their services – such as data centers – soars.
Room for improvement
Estimates of the tech sector’s contribution to global greenhouse gas emissions vary, from 1.4% to 2.3%. Unlike sectors such as aviation or shipping, much of its carbon footprint depends on electricity consumption – rather than the burning of fossil fuels – which makes it relatively simple to decarbonize. And taking advantage of this low-hanging fruit will have a sizeable impact: according to research by Ericsson, if the tech sector were to make the switch to renewable energy sources, it could slash its overall emissions by as much as 80%.
While Big Tech is well on its way to 100% renewable energy, some of the sector’s largest energy users still rely on conventional power for the majority of their electricity needs. And as scientists warn that global emissions must be cut by half by 2030 in order to avert the worst impacts of climate change, this has to change – and fast.
One issue is that variable generation of renewable power does not always align with the timing of the buyer’s electricity consumption – which means that they have to fall back on carbon-emitting alternatives such as coal or gas-fired electricity generation.
Solving for this means thinking out of the box, and Big Tech is increasingly doing this. A recent flurry of commitments from companies to match their electricity demand, hour by hour, with carbon-free electricity sources, is a huge positive move in the right direction.
While this is a recent development, Atlas believes that this is the beginning of the next step towards achieving the renewable energy transition, and one that Atlas is keen to facilitate. Through advanced structuring capabilities developed over the past year, Atlas is now able to provide load profile solutions for energy consumers. This is achieved through the appropriate design of a portfolio of renewable energy projects in which Atlas can deliver the expected hourly demand in the hubs where the load requirements are located.
As shareholders and investors set decarbonization targets, and consumers clamor for change, demonstrating leadership in clean energy has become central to corporate strategy across the tech sector – and the renewable energy sector is rising to meet the challenge.
With new financing options and business models that lower the barriers to entry, signing up to 100% clean energy is no longer restricted to the top tier tech behemoths. Thanks to corporate power purchase agreements (PPA), long-term contracts under which a business agrees to purchase electricity directly from an energy generator, the opportunity is now available for all players, across the technology sector, to take a vital step towards a net-zero future.
How Atlas can help
Without a shift to renewable energy, there is no sustainable way for businesses within the tech industry to continue with their electricity-heavy operations. Tackling climate change and reducing carbon emissions is one of the most important issues of our time, and companies in the sector must act now.
Atlas Renewable Energy was conceived with sustainability at its core. It develops, builds, finances, and operates clean energy projects across the Americas that enable companies to power their operations sustainably.
With a range of services, from renewable power purchase agreements (PPAs) to renewable energy certificates (RECs), Atlas helps large energy consumers across industries make the shift to green energy and manage their transition to net-zero emissions.
To find out more about Atlas Renewable Energy’s approach and how it can help your company meet its sustainability goals, email us: email@example.com
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