Carbon neutrality is a myth in the data centre industry

Lars Schedin, Senior Advisor at EcoDataCenters, on why carbon neutral is a lie the industry tells itself and its customers

Written by Harry Menear


The data centre industry is fighting - harder every year - to reconcile two seemingly irreconcilable goals. On the one hand, demand for capacity to support digital services, high-performance computing, 5G, the edge, IoT - you name it - continues to grow with no sign of slowing down this decade. By 2027, the industry is expected to grow from just under $60 billion to well over US$145bn

At the same time, the need to draw down on energy usage - both as a way of curtailing the industry’s own Scope 1 and Scope 2 emissions, as well as reducing their overall impact on already overstretched renewable energy grids - is an existential concern. 

“The shortage of power in Europe, in general, will also be felt in our industry this year,” says Lars Schedin, a Senior Advisor at EcoDataCenter (who served as the company’s CEO until summer last year), one of the greenest data centre operators in the Nordics. “In the FLAP-D markets, projects have been banned, there have been environmental protests, and other hurdles due to the fact that this industry is very power intensive. A power hungry industry and a society trying to undergo the process of electrification and decoupling from fossil fuels don't go hand-in-hand.” 

It’s not only rare that executives from within the industry acknowledge the data centre industry’s broader impact on their utility grids, buying up disproportionate amounts of green power to the detriment of residential areas and other industries, but it’s virtually unheard of to hear someone broach the idea that using “renewable power” and “green energy” to make data centres “climate neutral” might not be the sustainability panacea it’s sold as. 

“My mission for this year is to get people to understand that there is no such thing as climate neutral renewable power production. Even renewable power comes with embedded carbon. There is no such thing as climate neutral,” he says. “The ways that people are getting to count themselves as "climate neutral" are by doing something with their excess heat, or by purchasing climate emissions credits. We can't avoid emitting carbon. You can't test your diesel backup generators once a month and not be emitting carbon. It's impossible.” 

The idea that a company purchasing 100% renewable power is 100% carbon neutral is, at best, naive. At worst, it’s deliberately evasive. The challenge lies, Schedin explains, in a lack of true, nuanced examination of a company’s Scope 3 emissions - which he calls “the next big hurdle for the industry's sustainability efforts.” 

Going as Green as Possible  

EcoDataCenter is a solid contender for the title of “world’s most sustainable data centre company”. It even bills its flagship site in Falun, Sweden, as the world’s first “climate positive” data centre. 

To give an idea of how EcoDataCenter can be climate positive in a world where even climate neutrality is a myth, Schedin breaks down the steps for getting as close as possible to a supposedly unattainable goal. “First, your power supply should obviously be renewable, but you should also be as close to the source of that power generation as possible in order to minimise distribution losses,” he says. “Keep in mind that, in Sweden, the third largest consumer of power is distribution loss.” He adds that the Falun site is located more or less adjacent to the hydroelectric power plant that supplies most of its electricity. 

100% renewable power will only get you so far, however. Schedin stresses that it’s imperative that data centre operators make use of the excess heat emitted by their servers. While he notes that it doesn't matter what you're connected to (in the last year I’ve seen data centres hooked up to swimming pools, housing complexes, and even a lobster farm), but “you need some way to recapture, redirect, and reuse heat from your servers.”  

EcoDataCenter’s site redirects excess heat into a local district heating system. “The combined heat and power plant where we redirect our excess heat is only 200 metres away from our Falun data centre, so we can recapture a large portion of our emitted heat and use it to warm local homes very efficiently,” Schedin says.   

Additionally, excess heat that isn't needed by the district heating system is redirected to a sawdust pellet factory, which creates fuel that can be stored, sold to homes and industries in the wintertime, and burned for fuel. 

“We avoid a lot of emissions, both in our own operations and in the district heating system - because when it really gets cold, the district will peak its heating with oil or gas,” Schedin explains. “When we calculate our emissions, we also try to track exactly how many carbon emissions we're avoiding with things like heat recapture.” The result of using excess heat recapture and renewable energy, then, is that EcoDataCentres is preventing the emission of more carbon than it emits itself. This, Schedin explains, is where many data centre operators stop. 

“However, while we're avoiding more emissions than we actually create, that shouldn't be used to hide the fact that we are emitting 16 grams of carbon per kilowatt hour,” he says. “We can't avoid that fact. The industry can't avoid that fact, and we shouldn't be trying to hide it.” 

In Bed with Embedded Carbon 

All modern manufacturing comes with the uncomfortable reality of embedded carbon. EcoDataCenter keeps the embedded carbon in its physical buildings very low by mostly using laminated wood in the construction process. Schedin explains that the alternatives, steel and concrete, are both “very environmentally impactful materials,” adding that “Concrete still accounts for something like 8% of all global emissions.” 

This is where the cracks in the idea of climate neutral or completely green power start to show. “The hydroelectric power plant where we source our 100% renewable power contains a lot of concrete. Even if that plant's embedded impact is spread out over its entire life cycle, it's still so much concrete that each kilowatt hour we consume from that hydro plant comes with 9 grams of embedded carbon emissions attached,” says Schedin. “Hydro comes with 9 grams per KWh, wind comes with 12 grams - and that's if you're experiencing 0% distribution losses, which is never the case, and could increase your emissions by as much as 10%.”  

Wind and hydro aren’t the only sources of “green power” that Schedin notes aren’t as sustainable as they seem. “There are places like Iceland, which use a lot of geothermal power. And geothermal emits no carbon. It emits a lot of methane, which is much, much worse,” he says. “Geothermal is actually a really dirty energy source that might be as bad as coal. It's billed as a renewable power source, but in places like Turkey and Indonesia it's generating as many greenhouse gases as coal. Even in Iceland, where it's a little better, they've only managed to get the equivalent embedded carbon down to about 40-50 grams per KWh, but that's still 10 times more than nuclear power.”  

In an industry where conversations about sustainability are only going to get harder, Schedin stresses that “the kind of rhetoric that calls generation methods like geothermal renewable, and calls a data centre 'climate neutral' makes life a bit too easy. You need to dig deeper.” 

As Scope 3 emissions become a bigger part of the conversation, and the data centre industry’s customers place genuine sustainability at the core of their business models, it feels like the industry is on track for a reckoning. “These truths need to be disclosed. Emissions need to be examined transparently, and knowledge needs to be shared so that the industry as a whole can build the most efficient data centres that it can, wherever those sites are located,” Schedin reflects. “Renewable power comes with embedded carbon. No one can argue with that statement, but still we have companies out there in the industry claiming to be 100% climate neutral. The market and the industry may not be ready for these difficult conversations, but the customers are ready for it, and I think that will drive some serious changes quickly.”


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