China's tech firms need to buy more clean energy

15 January 2020

China’s tech industry needs to “dramatically” increase its procurement of renewable energies to power data centres, according to a report.

Greenpeace has recommended that China’s internet industry set targets for 100% renewable energy use as electricity consumption from data centers is on track to increase by 66% by 2023.

A report by Greenpeace and the North China Electric Power University tracked the renewable energy use of China’s tech industry and found that more than 50% of internet companies have actively procured renewable energy, but only on a limited scale.

This included tech firms Alibaba, Baidu, Tencent, Huawei, and independent data operators Chindata Group, GDS, AtHub and 21 Vianet.

Chindata Group is the only data centre operator based in China that has set a target to procure 100% of energy from clean energy sources. 

Chindata Group, Alibaba, and Tencent were ranked highest out of the 15 largest firms analysed, based on energy transparency, energy efficiency and carbon reduction, renewable energy performance, and government and industry influence.

According to the report, during the first three quarters of 2019, Alibaba, Baidu, Huawei, Tencent, Chindata Group and GDS procured 400,000 megawatts per hour (MWh) of renewable energy, which is around Beijing's total power consumption over a 24-hour period.  

Chindata’s Guangting Reservoir Data Center in northern China’s Hebei province ran at 56% renewable energy during the first half of 2019, according to the report. 

Alibaba and Chindata Group worked with the government of Zhangjiakou in the Hebei province for a “four party cooperation mechanism,” to allow operators to procure renewable energy directly from wind and solar generators.

The number of companies among China’s biggest tech firms disclosing energy consumption and emissions data has increased from zero to 20% since 2015, said the report. 

Greenpeace recommended companies spend more on renewable energy and collaborate with governments, grid companies and power retailers to increase clean energy procurement mechanisms.

Greenpeace suggested firms develop on-site or off-site wind and solar plants, purchase directly from the local markets, or buy green power certificates that allow companies to claim environmental benefits.

More diversified and cost-effective procurement options will emerge in the next few years as the power market evolves to include new procurement markets including distributed generation markets and interprovincial and spot markets for green energy, according to the report.

Meanwhile, China’s government has pledged to increase service outsourcing and support digital transformations in sectors such as cloud computing and software. 

China aims to become the main channel for service exports and increased digital services by 2025, according to the Ministry of Commerce.

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