ESG and the Need for Sustainable Data Centers

data center illustration with green grass outside

In the era of ESG, companies need to drive sustainability through their supply chains with data centers being a key aspect. We look at some of the developments and selection criteria for sustainable DC partners.

Environmental, Social and Governance issues, or ESG, has become the ethical management mantra for the Fourth Industrial Revolution. It has been galvanized by the effects of the pandemic on working practices, mental wellbeing, and the realization by governments that addressing the climate crisis is a matter of urgency.

klaus schwab 4th industrial revolution

The steam engines, production lines and electricity, computers and electronics of the previous industrial revolutions relied on fossil fuels. The fourth is built on connectivity and cyber systems like cloud-computing, IoT and AI – with data centers being the primary infrastructure. The climate crisis demands that fossil fuels are no longer the primary power source.

Sustainable best practice is to run things on electricity while taking steps to clean up electrical generation. Some countries, especially those with abundant hydro and geothermal sources, have made their electricity generation almost 100% sustainable. However, as wind and solar solutions slowly come on-line, we are still in energy transition and some big economies are way behind.

A key aspect of powering industries with renewable energy is bridging the gaps in generation when the Sun isn’t shining or the wind isn’t blowing. To achieve this, the energy storage industry will need to grow 100-fold to reach 2050 targets and the onus will be on power generation companies but, as data centers become larger, it is likely that more will generate and store their own energy or locate close to sources of generation and storage, provided there is also access to the fiber network. Microsoft, Facebook and Google have set up sites in Iowa to gain access to abundant wind generated electricity.

The 4 main storage technologies, each with many variations, are:

  • Pumped Hydro, where water, or other liquids are pumped to a higher point using excess renewable energy to be released downwards into generation turbines when required.
  • Chemical energy storage, predominantly using lithium ion batteries. A 300MW facility went online in California in 2021.
  • Thermal storage, where water, concrete, sand, molten salt retain heat to be used for power generation when required.
  • Mechanical, kinetic energy is stored by lifting blocks, loading up flywheels, compressing gas etc. to be used to release power on demand.

Data Center Energy Consumption

Data centers already use an estimated 2% of electricity globally, so there has to be innovation to manage consumption as well as the energy source. The onus can be put on the data center owners to achieve these objectives. The economies of scale, continuous improvement and cutting-edge technologies of the providers mean that there are immediate sustainability benefits in moving to cloud where possible.

cloud sustanability

As industries adopt Cloud resources, selecting appropriate partners that align with ESG goals becomes more important. When screening a Cloud or data center partner in line with ESG policy, there are many factors to consider. Rather than a snapshot number for average power usage effectiveness [PUE] or the percentage of renewables in the power supply, it is important to see evidence of a supplier with a roadmap for constant improvement and a range of metrics, principles, and methodologies. When providers are signed up to an agreement like the Climate Neutral Data Centre Pact in Europe or VMWare’s Zero Carbon Committed initiative it helps to demonstrate a structured approach and provides balanced means of comparison, especially alongside ISO14001 and other standards for the recycling of electronic componentry.

Central Pillars of the Climate Neutral Data Centre Pact:

Initiatives of this nature cover energy sources and consumption metrics. Taking the European CNDCP example, here are the main commitments of the signatories:

  • Carbon neutral data centers to run on 100% renewable energy by 2030.
  • Increase energy efficiency with challenging and measurable PUE targets.
  • Aggressive targets for increased water efficiency in data center cooling.
  • Adoption of circular economy concepts to repair, reuse and recycle servers and other infrastructure.
  • Circular energy system – using expelled data center heat to benefit the local economy.

The Big Three Cloud Providers; Amazon Web Services [AWS], Microsoft Azure and Google Cloud Platform [GCP] are all signatories to the pact and have each made global sustainability claims. GCP aims to be the first major company to operate 24/7 on carbon-free energy by 2030 having become carbon neutral in 2017. Microsoft Azure became carbon neutral in 2014 based on renewable energy certificates but claims its data centers will be 100% powered by renewable energy by 2025. Clients can track their environmental impact through Azure using the MS Sustainability Calculator. AWS aims to power all operations with 100% renewable energy by 2025 with the same target for the wider organization by 2040, but despite these objectives and the investment in renewables projects, the plan seems to rely on offsetting, even after 2025. Speaking to Tech Monitor, Oskar Almen, partner for energy and utilities at PA Consulting, said:

“Theoretically you have a net-zero product, but some of my clients in the data center industry would argue the only way of being truly net zero is to prove that the source [of the energy] is net zero. To just buy a certificate is not making the world better.”

In a vendor selection scenario, we would seek greater detail and assurances. It is likely that the big three will hit 2030 targets in Europe but that two may be better positioned for a sustainable global partnership. The VMWare initiative, signed up to by cloud partners such as IBM, Atea, OVHcloud, MS Azure and Equinix, would be more to Almen’s liking, as it demands that all signatories run their data centers with entirely renewable power sources. It is through this kind of relationship, where demonstrable assurances are sought from suppliers, and their supply chains in turn, that goals will be achieved.

Other Sustainability Questions

Data Center Monitoring

To differentiate between suppliers, a client organization may want to see more detailed responses on a range of criteria. Uptime, security, service assurance, cost, and access management are headline selection requirements, but our focus here is sustainability. We are not presenting a list of criteria but rather a selection of relevant topics to interrogate.

A DC facility should be equipped with sensors and meters to monitor for power and environmental issues. Data center infrastructure management software [DCIM] is essential to perform metrics, analyze trends and report on energy efficiency. It helps to optimize the utilization of existing resources, avoid inefficient buildouts, and drive more sustainable behavior.

DCIM has many other benefits including:

  • Monitoring real time power including any risk in the sustainable supply due to weather or storage issues
  • Identifying ghost servers that use power but serve no purpose
  • Identifying power hogs that run inefficiently and should be replaced, repaired or virtualized;
  • Setting threshold alarms for temperature and humidity, plus rack, inlet and circuit-breaker loads.

Data Center Cooling

The ASHRAE report in 2004 established that raising inlet and operational temperatures in DCs can provide huge efficiency improvements, but some companies, with an eye on cooling, still keep temperatures lower than necessary. Separating inlet air from from hot exhaust air via hot/cold aisle containment can improve energy efficiency by up to 40% and is far better than trying to maintain an unnecessarily low maximum temperature throughout the facility, partly because it limits the risk of cooling equipment failing. By the same tenet, risk also increases if temperatures are kept too high, but it is insightful to understand the general approach. Anything that reduces bypass airflow can improve cooling efficiency, even simple solutions like raised floor grommets and blanking panels can make a worthwhile difference.

Data Center Location Network

Suppliers will also be able to talk about their site selection rationale and current network of DC locations. In the context of sustainability there should be a suitable ambient climate with access to 100% renewable energy and other resources without the need for excessive travel. The layout should feature optimum server density and rack heights for efficient operation. The strategy for working with energy suppliers and for energy storage either onsite or in the supply chain should be clear.

Data Center Sustainability Innovations

Novel innovations in data center efficiency are not necessarily a deal breaker in terms of selection and some solutions will not be relevant to every use case. However, a company that is willing to trial new technologies in the interests of sustainability sends out a strong message of commitment. Here are some notable examples:

Google’s “Next-Gen Geothermal” is an always on solution that uses fiber optics to optimize performance and is being trialed using heat sources deep below the Nevada desert.

“Carbon-intelligent computing” is another Google initiative. It is like applying DCIM at the wide area network level to transfer movable computing between data centers and optimize the use of live renewable energy.

Microsoft has experimented with underwater data centers run on renewable energy. There are benefits to the environment being more easily controlled and significant reduction in human error.

Water efficiency can be achieved by using closed loop and evaporation-based systems that require less energy and liquid. Liquid cooling has been a trending data center topic for years. It can provide a 35% consumption improvement over air cooling but is very awkward to retrofit. 2021 saw one of the biggest immersion cooling facilities at Alibaba’s Winter Olympic site in China. Modern data center servers have dozens of internal sensors allowing for effective cooling down to component level including the direct liquid cooling of circuit-boards using sprayers.


Move systems and services to the Cloud to meet your ESG targets. Making the move drives immediate efficiency benefits and by selecting your partners carefully you will be best placed to benefit from new improvements that will emerge at increasing pace over the coming years.