In July, Amazon released its 2023 sustainability report, which revealed a 3% reduction in year-on-year emissions and that it had reached its goal of 100% renewable energy for its operations – a feat Google achieved in 2022. Google, however, has followed Microsoft in becoming the latest tech giant to report increased year-on-year emissions. In its annual environmental report Google announced a 13% rise in greenhouse gas emission for 2023 and a 48% increase over 2019, the baseline for its emissions reduction targets. It remains unclear whether the emissions of AWS – the unit within Amazon responsible for its data centres and the closest match to a Google or Microsoft – increased or decreased on its own, as Amazon doesn’t provide business-unit-specific emissions data.
According to Google, its emissions increase is a result of the increased energy appetite of AI and the scarcity of renewable energy. The recent explosion of AI-powered services involves considerably more computing power than standard online activity, driving data centres’ demand to an all-time high. Google has invested heavily into this area, with its data centre energy consumption in 2023 at more than 24 terawatt-hours – roughly 10% of the electricity consumed by data centres globally. As a result, Google’s Scope 2 emissions increased by 37% from 2022 to 2023, marking the third year-on-year increase in total emissions.
In contrast, Amazon has been on a spending spree in recent years as it procures renewable energy via power purchase agreements (PPAs) to reduce its Scope 2 emissions (see Verdantix Market Overview: Demystifying Corporate Power Purchase Agreements). With its latest sustainability report now publicly available, it appears that Amazon has achieved its goal of 100% renewable energy seven years ahead of schedule. According to Bloomberg NEF, Amazon was the largest corporate purchaser of renewable energy for the fourth year running in 2023, having invested in more than 500 solar and wind projects.
The contrasting sustainability reports reveal the broader challenges and complexities in the pursuit of net zero emissions. Amazon’s feat demonstrates that with high capital investment and an aggressive strategy, it is possible to reduce emissions. Google’s latest revelation reveals the shifting emissions landscape facing organizations. Firms must understand the challenges of increased business growth while also attempting to achieve sustainability goals, which underscores the importance of continued innovation to tackle sustainability challenges. Following the release of its sustainability report, Amazon announced the launch of the sustainability exchange, a new platform offering free access to sustainability tools and resources the firm has used or is using to decarbonize its operation. This aims to share its learnings and experiences to help other firms.
The Verdantix Future of Data Centres report – which explores the carbon conundrum in the age of AI facing operators such as Amazon, Google and Microsoft – will be published in August 2024. To be notified upon publication, please reach out to contact@verdantix.com.
