It used to be that organizations each built their own data centers and managed their own equipment. In order to ensure that organizations had enough capacity for their users, they would over provision, buying and operating extra equipment so that it was always ready, just-in-case. A well run data center would operate at an average of 20% utilization, meaning that about 80% of that capacity – and the energy needed to keep it “ready” – was wasted.
Enter cloud computing. Cloud computing helps save energy – and by extension, money – by replacing these individual, under-utilized data centers with a fewer number of large, more efficiently designed data centers.
The leader in this field is Amazon Web Services (AWS) with their array of computing, storage, networking, databases and application services that help organizations manage their data and applications more securely and more efficiently. And they’re really good at it! In fact, AWS Infrastructure’s rack-optimized systems consume less than 1/8th the energy of the “blade server enclosures” that are often used in corporate datacenters.
With the projected growth of cloud computing and the explosive nature of data generation, the use of renewable energy by technology companies becomes even more imperative. Renewables offer several benefits to a tech industry whose entire existence essentially depends on data storage. It’s not just that a 20-year power purchase agreement with a renewable energy producer can help cut the cost of storing data, although that’s a big reason for the attractiveness of renewables. Clean energy also offers the purveyors of big data a hedge against volatile fossil fuel prices that are constantly shifting due to outside factors. In contrast, the price of renewable power never changes, because there is no cost associated with its fuel.
That’s important. Wind energy saved ratepayers over $1 billion during just two days of last year’s polar vortex because the cost of coal and natural gas skyrocketed. Another polar vortex could cost tech companies millions. So there’s no question that the fate of the U.S. tech industry is inextricably linked to the fate of renewables.
Amazon is joining ACORE to increase its work with state and federal policymakers and other stakeholders to enable more renewable energy opportunities for cloud providers.
Director of Amazon Public Policy, Shannon Kellogg told me that the company is focusing on clean energy for a few reasons. “By investing in renewables, we’re sending a strong signal that these sustainable sources of energy are viable and in-demand. That helps us ensure we’re doing our part to provide a cleaner, healthier environment for our customers and their families.” But there’s more to it than that. He added, “We know we are doing right by our customers if we are able to both increase their usage of renewable energy and lower their costs overtime.”
Amazon wants to be a leader in clean energy usage. Obviously, the company’s membership in ACORE is one part of that. AWS will also be participating in the U.S. Partnership for Renewable Energy Finance, a coalition of top-level financiers that informs policymakers of the effect of policy measures on the burgeoning renewable energy industry. But Amazon’s commitment to renewables goes deeper than its membership in ACORE.
AWS has a long-term commitment to achieve 100% renewable energy usage for their global infrastructure footprint. Amazon also teamed with Pattern Development to support the construction and operation of a 150 megawatt (MW) wind farm in Benton County, Indiana, called the Amazon Wind Farm (Fowler Ridge). The project will start generating approximately 500,000 megawatt hours (MWh) of wind power – enough to power 46,000 U.S. homes – annually as early as January 2016. The energy generated by that project will be delivered into the electrical grids that supply current and future AWS datacenters.
Expect to see more commitments like that in the future. For an industry that relies on electricity so much, ensuring affordable, reliable and clean power is an imperative. After all, some sources of renewables are already cost-competitive with fossil fuels, and that trend will only continue. Amazon is doing its part to make sure the clean energy industry continues to thrive and we look forward to their impact and leadership in ACORE.