In this edition of Voices of the Industry, Bill Kleyman, EVP of Digital Solutions at Switch, discusses why sustainable data centers are key to the success of the Fourth Industrial Revolution.
It’s an exciting time to be in the data center industry. Beyond all of the growth in public cloud and colocation data centers, we’re also seeing a massive amount of innovation across all industries. According to the World Economic Forum, the speed of current breakthroughs has no historical precedent. Compared with previous industrial revolutions, the Fourth Industrial Revolution is evolving exponentially rather than at a linear pace.
If this is the first time you’re hearing about the Fourth Industrial Revolution, you are not alone, and let’s take a second to define it. From the World Economic Forum, they represent the Fourth Industrial revolution as follows:
The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now the Fourth Industrial Revolution is building on the Third, the digital revolution occurring since the middle of the last century. It is characterized by a fusion of technologies blurring the lines between the physical, digital, and biological spheres.
The Fourth Industrial Revolution is not simply about adopting new energy technology such as lithium batteries, solar power, efficient distributed generators, and tankless water heaters, it is a fusion of those energy technologies with an astonishing array of information technologies and services. We’re seeing this fusion of technologies with new solutions around augmented and virtual reality, autonomous systems, and the early emergence of the metaverse. Moreover, unlike the previous three revolutions, society must leverage the fourth industrial revolution to sustainably rebalance the global ecosphere to address the environmental legacies of the revolutions before. So, why is it so exciting to be in the data center space? Because public cloud and data center colocation is at the center of the Fourth Industrial Revolution. If anything, it’s the engine that helps drive it.
As we enter a new era of collaboration, technology, and human and machine interaction, we must ensure that our Fourth Industrial Revolution remains as green as possible. Furthermore, we must design systems that are sustainable and help undo some of the climate damage done by the preceding three revolutions. Aside from the clear karmic benefits of doing the right thing with helping our environment, there are massive financial benefits to building a greener and healthier future.
A recent post from Data Center Frontier notes that investors will be part of the green energy revolution as they seek to align their portfolios with climate resilience. There will be more green funding deals in the future, driven by investors’ growing appetite for sustainable options. According to Morningstar, 76 new climate-aware funds were launched globally in 2020, which now tracks more than 400 mutual funds and exchange-traded funds globally that have climate change as a critical theme.
“Sustainable debt is likely to go through the roof this year,” said Dr. Richard Mattison, the CEO of Trucost, a unit of S&P that assesses corporate risk from climate change. “This year, we expect to see many more funds springing up targeted at sustainability and green outcomes. Where investors want to put their money is going to lead to a huge change in capital markets, and most financial institutions recognize that.”
This is where it gets interesting. How do we power the Fourth Industrial Revolution to ensure a more sustainable future? And, how do we ensure that we begin to reduce greenhouse gas emissions measurably? We as an industry continue to do what we’re so good at – Innovate.
Powering the Future Will Require Innovation and Creativity
A recent WSJ article noted that to meet global energy demand and climate aspirations, investments in clean energy would need to grow from around $1.1 trillion this year to $3.4 trillion a year until 2030. The investment would advance technology, transmission, and storage, among other things.
Before we dive into some really creative solutions to power the future, it’s important to note that green solutions are already gaining quite a bit of market share in the energy sector. We actually hit a pretty significant milestone in 2019. That year, before the onset of the pandemic, the U.S. consumed more renewable energy than coal for the first time since 1885.
So, is this goodbye to using fossil fuels? Almost. “We’re starting the long, long goodbye,” states Bob Fryklund, a strategist at IHS Markit. Driving this “long goodbye” are amazingly innovative solutions to power some of the world’s largest technology platforms. Let’s see how this is happening.
- Switch Gigawatt 1: Recently, Switch announced Rob Roy’s Gigawatt Nevada, a massive solar energy and battery storage project. This development is one of the technology industry’s most significant solar footprint and battery storage projects. Upon completion, it will reach 1 Gigawatt of solar power across Nevada and over 800 MW hours of battery storage leveraging Tesla Megapack technologies. “In the midst of this unprecedented moment in our state’s history, Switch and its partners are investing $1.3 billion, creating over a thousand new jobs and accelerating Nevada’s leadership in the world’s renewable energy economy,” said Nevada Governor Steve Sisolak. Additionally, Switch has a dedicated local, renewable resource for solar power, Switch Station 1 and Switch Station 2, located in Southern Nevada, generating 179MW of green energy.
- Dominion Energy’s Coastal Virginia Offshore Wind Project. In July, Dominion Energy announced an extraordinary project. The proposed 2.6-gigawatt Coastal Virginia Offshore Wind (CVOW) commercial project will be the largest planned offshore wind farm in the United States. “I’m thrilled to see this project underway as it’s an exciting step toward a clean energy economy that creates good jobs in the Commonwealth,” said U.S. Senator Tim Kaine (D-VA). “I will keep pushing for clean energy investments in Virginia to boost our economy and build a more sustainable future.”
- Japan: The World Leader in Floating Solar Panels. A recent post from the World Economic Forum puts it best: How do you increase your solar energy output when you need all your land for agriculture and housing? Take to the water. The world’s first floating solar plant was built in Japan, in Aichi Prefecture in central Honshu. The country’s many inland lakes and reservoirs are now home to 73 of the world’s 100 largest floating solar plants and account for half of those plants’ 246 megawatts of solar capacity. The biggest Japanese floating solar plant sits behind the Yamakura Dam at Ichihara in Chiba Prefecture. It covers 18 hectares, can power nearly 5,000 homes, and saves more than 8,000 tonnes of CO2 a year.
- The Power of the Tidal Turbine. Using the power of tidal currents is such a remarkable innovation. A tidal turbine weighing 680 metric tons and dubbed “the world’s most powerful” has started grid-connected power generation at the European Marine Energy Centre in Orkney, an archipelago located north of mainland Scotland. In a recent announcement, Scottish engineering firm Orbital Marine Power explained how its 2-megawatt O2 turbine had been anchored in a body of water called the Fall of Warness, with a subsea cable linking it to a local electricity network on land. It’s expected that the turbine, which is 74 meters long, will “operate in the waters off Orkney for the next 15 years,” the company said, and have “the capacity to meet the annual electricity demand of around 2,000 UK homes.”
- Switch’s Water Improvement Pipeline Project. We can’t forget about water and water scarcity as a consideration for a greener tomorrow. Governor Steve Sisolak joined leaders from every local government in the Truckee River region to celebrate the commencement of the construction of the Regional Water Improvement Pipeline Project. Switch is leading the development of a 16-mile, 4,000 acre-foot effluent water pipeline in Northern Nevada to support meaningful water conservation efforts. Consider this; today, Switch operates a 1.3 million square foot data center at the Citadel Campus. The company intends to build up to 7.2 million square feet of IT capacity and a total power capacity of 650 megawatts. The exceptional part here is that this pipeline will support all water requirements at the multi-million square-foot campus.
Want another extraordinary example? Imagine a nuclear reactor powers your future data center. A recent DCD post discussed how small modular reactors (SMRs) are under development by a consortium led by Rolls-Royce. And, if you think this is a far-fetched notion, it’s not. At the upcoming AFCOM Data Center World Conference, the Department of Energy and other presenters will discuss deploying and financing SMRs in the data center industry. They’re also doing a complete virtual reality walkthrough of an actual SMR.
Pretty exciting stuff, right? Now, let’s shift for a moment and focus on selecting the right partners to ensure a sustainable future. To do so, we need to discuss greenhouse gas emissions.
Eliminating GHG and finding the right partners to support a greener tomorrow
According to the EPA, carbon emissions are responsible for more than 80% of overall greenhouse gas (GHG) emissions. To remain sustainable, enterprises must monitor and report their CO2 emissions, which is the crucial first step in reducing them. To help define a company’s carbon footprint, greenhouse gas emissions are generally categorized into three groups, or Scopes, under the Greenhouse Gas (GHG) Protocol. There are three Scopes to consider.
- Scope 1. This measure covers direct emissions from owned or controlled sources.
- Scope 2. This measure covers indirect emissions from the generation of purchased electricity, steam, heating, and cooling the reporting company consumes.
- Scope 3. This measure includes all other indirect emissions in a company’s value chain.
In selecting a partner, it’s important to challenge them around their emissions strategy and ensure that it’s not just a long-term goal. For example, partners like Switch have consistently achieved zero Scope 2 carbon emissions, since 2016. And, in 2021 achieved zero Scope 1 emissions.
Again, as part of your evaluation criteria, be sure to look for partners who are actively tracking towards net zero.
Here’s the other important point. In working with a sustainable data center partner, you’re capable of reporting your efforts on your ESG reports. To support customer initiatives around sustainability, Switch data centers provide each client with a sustainability certificate that can be used on ESG reports to use 100% renewable energy within Switch’s ecosystem. This helps clients meet their own corporate sustainability goals and reduce carbon emissions of their overall footprint.
As you set out on your path towards a greener tomorrow, never discount humanity’s capability to be extraordinarily innovative and creative. Partners like Switch are actively taking a leading role in water, power, and sustainability. For example, Switch recently received the highest Environmental rating, “E-1”, from S&P Global’s new ESG Credit Indicator Report Card. Switch is the only company among more than 180 issuers in its Global Telecom sector coverage to achieve an E-1 rating, including other public and private peers in the U.S. data center industry. S&P Global introduces this ESG Report Card as an additional component to its already well-known corporate credit ratings and analysis.
It’ll be critical for you to work with partners that help innovate sustainable solutions. As we emerge into the Fourth Industrial Revolution, it’ll be essential to power our future solutions as sustainably as possible. To do so, we’ll need innovation, creativity, and great partners to guide us along.