Introduction of technology to simplify energy purchasing options.
The Australian data centre sector can do more to reduce its carbon footprint while containing and even reducing energy expenditure thanks to technological advancements in energy procurement, states a report by WePower — a blockchain-based green energy trading platform.
WePower’s Data Centres – A Guide to Sustainable Procurement report found the sector is well-positioned to benefit from technology that makes Power Purchase Agreements (PPAs) available to smaller businesses using under 10MW of power annually, as well as simplifying legal and financial processes around direct energy procurement.
The Australian data centre sector is responsible for about four per cent of national energy consumption – second only to the resources sector.
It is also highly contested, with more than 50,000 data centres registered in Australia. Energy currently accounts for one in every five dollars of operational spending by the average data centre – the greatest single operational cost for most energy centres.
For data centres whose usage exceeds the 10MW threshold for traditional PPA procurement, traditional models of energy sales have presented barriers to sustainable energy buying for data centres. These include:
- Concerns around continuity of supply
- Complexity of negotiations and contracting for blended solutions (procuring power from more than one project)
- The long timeline for traditional PPAs
- Intensive, complex and costly legal processes for procurement
- Financial and back-office challenges
The introduction of technology will simplify procurement, standardise legal processes and allow more flexible and transparent energy purchasing options. It will also provide Australian data centre sector the opportunity to directly purchase sustainable energy while lowering barriers around both size and complexity.
The report identifies three options for prospective data centre customers – direct PPAs, direct PPAs with firming arrangements (also known as ‘sleeved’ PPAs) and retail PPAs where a retailer offers energy linked directly to a specific project, guaranteeing supply, said Harley Tempest report author at WePower.
“For a sector as energy-intensive as the data centre business is, having the option to engage in reliable, transparent and flexible green energy procurement is a game-changer,” said Tempest.
In a statement to CIO Tech Asia WePower said the current climate crisis has made consumers and companies are acutely conscious of the need for sustainable-driven growth to maintain continuity across all business operations.
“In the data centre sector, energy costs have to be controlled at the same time as sustainability is addressed,” stated the company. “WePower platform simplifies the transaction of green power for customers who previously had no direct procurement option. We deliver greater flexibility to manage contracts, customer portfolios, and PPAs end-to-end, all while doing so remotely.”
WePower was founded in Lithuania and has offices in Europe and Australia. Currently they have had a few pilots in APAC – which it sees as “interesting market for the company”.
