How Amazon Matches Power Needs to Green Energy Sources
Last week, Amazon announced it had already met its 100% renewable energy goals — seven years early.
The green news from the world’s single largest retailer was rosier than its cloud computing peers. In early July Google had reported its overall emissions in 2023 grew 13%, blaming AI’s increasing demands for power.
Microsoft also reported an overall increase of 29%, which they said was mostly due to the construction of new data centers. (Progress was made in several areas, Microsoft said, reporting a 6.3% reduction in emissions coming from company-controlled assets and power supplies known as “Scope 1” and “Scope 2” emissions.)
🆕 ♻️ We’re excited to announce that we’ve met our 100% renewable energy goal seven years early!
Read more in our latest Sustainability Report 👇 https://t.co/RokilqsyuL
— Amazon News EU (@AmazonNewsEU) July 10, 2024
Amazon is, indeed, the world’s single-largest purchaser of solar and wind power by far, and continues to fund hundreds of different clean-energy projects. But how should the impact of those projects be calculated — with other parts of Amazon‘s operations still responsible for greenhouse gas emissions? It’s a crucial question, with implications for other companies, the renewable energy sector, and ultimately — for planet Earth.
But maybe the debate itself proves just how seriously this challenge is being taken…
Up or Down?
Amazon’s announcement begins by acknowledging a 7% increase in emissions from their own direct operations, “primarily from the use of transportation fuels.” But then it reported an 11% reduction in emissions from electricity, plus a 5% decrease in indirect and supply chain emissions, calculating an absolute carbon emissions decrease of 3%.
Still, “critics allege those calculations are misleading,” the Seattle Times reported Wednesday, adding that Amazon’s carbon emissions “are still nearly 20 million metric tons greater than at the start of its five-year journey… the company’s carbon footprint has not yet dipped below 2019 levels, the first time it disclosed its carbon emissions.”
What’s going on? Amazon announced all energy consumed by its operations (including data centers) in 2023 was now being “matched” by renewable energy. A video from Amazon notes that in 2019, they were matching about 42% of their energy consumption with renewable energy — so over the last five years, that matching has clearly increased.
In February, the research group BloombergNEF reported that, partly because of this matching, Amazon had actually bought more solar and wind energy in 2023 than all three of the next largest purchasers in the world — combined. (That’s Meta, LyondellBasell, and Google…) In fact, Amazon alone accounted for nearly one-fifth of all renewable power purchase agreements in 2023.
That gave Amazon the eighth-largest clean energy portfolio in the world, according to BloombergNEF (“though Amazon doesn’t own its projects”.) Kyle Harrison, head of sustainability research at BloombergNEF, said in February that “Amazon’s commitment to clean power demonstrates how a single company can help accelerate the transition to the low-carbon economy on a global scale.”
But this approach has drawn some criticism from an activist group called Amazon Employees for Climate Justice.
Last week the group issued a strongly-worded counter-statement arguing that Amazon often just buys energy from local grids — “investing in data center expansion in locations heavily dependent on oil, gas, and coal — like Northern Virginia and Saudi Arabia.”
The group claims Amazon offsets those carbon emissions by funding renewable energy generation elsewhere — and estimates that about 68% of these offsetting Renewable Energy Certificate (or “REC”) purchases “are low-quality and do nothing to build new, additional renewable energy; these credits simply trade around paper claims on electricity that other people already generated and consumed.” (They base this claim on data they say Amazon submitted to the long-running international nonprofit, the CDP (originally the Carbon Disclosure Project.)
As employees, we’re outraged with Amazon’s misleading announcement today that “Amazon meets 100% renewable energy goal 7 years early.” We estimate that in the US, Amazon actually only gets 22% renewable energy from the local utilities where its data centers operate. pic.twitter.com/kkqYRq3sVc
— Amazon Employees For Climate Justice (@AMZNforClimate) July 10, 2024
Amazon Responds
When asked for a comment, Amazon accused the group’s report of “incorrect findings and assumptions, likely because, as its authors admit, it’s based on data and opinion from outside the company” — while it’s Amazon’s newly-released Sustainability Report that “has the correct data, transparent published methodologies, and third party assurance.”
Amazon’s sustainability report acknowledges that while it reported an 11% decrease in emissions from their power usage in 2023 — 4% of their total carbon footprint — it came from using renewable energy and purchasing renewable energy credits.
An Amazon spokesperson explained to The New Stack that, “It can take several years for the solar and wind projects we invest in to be built and begin generating renewable energy. In the interim, we purchase unbundled Renewable Energy Credits to bridge the gap to the project’s operational date temporarily. This allows us to continue signaling to the market our support for renewables.”
Amazon is not the only company matching its power consumption with renewable investments. “In total, over 200 corporations announced power purchase agreements in 2023,” wrote BloombergNEF, “showcasing the popularity of clean energy buying as a decarbonization tool for the private sector.” In fact, together all the corporate power-purchase agreements totaled 46 gigawatts — up from just 41 gigawatts in 2022, and represents the seventh year in a row where the total has increased.
So what’s the significance of offsetting carbon-based energy with renewable energy produced elsewhere? “The joint action by the corporate community has enabled this renewable energy industry to move fast, to achieve it on a rapid timeframe,” explains an Amazon video, touting Amazon’s investment of billions of dollars in over 500 projects worldwide.
And Amazon’s announcement of its latest sustainability report highlights some trail-blazing. “We were the first corporation to enable utility-scale renewable energy projects in India, Greece, South Africa, Japan, and Indonesia,” a company announcement pointed out, “among other countries. To accomplish this, Amazon worked with policymakers to enable first-of-their-kind policies to help corporations support the construction of new solar and wind projects…”
Yet the activist group’s counter-statement includes this counterpoint from former NASA scientist Dr. James Hansen (also director of the Climate Science, Awareness and Solutions Program at Columbia University). “The great tragedy is that practically the entire world is being allowed to employ this gimmick.” But because of Amazon’s size, Hansen thinks it’s important to note their use of the tactic.
And there could be a real-world impact, climate scientist Dr. Sarah Myhre argues in the group’s counter-statement. Myhre believes Amazon’s energy use “is being used to justify building new fossil fuel infrastructure, like pipelines, export terminals, and refineries, and to delay the retirement of coal plants.”
Moving Forward
The employee group summed up their complaints succinctly with this quote from Brenda Huerta Soto, community organizer from the People’s Collective for Environmental Justice. “As long as Amazon is pushing diesel trucks through our communities and continues to pollute our air, there is no way their 100% renewable energy claim is true.”
But going forward, Amazon is still pursuing a wide variety of other climate initiatives. Last week Amazon announced it would “prioritize working with suppliers who are also committed to decarbonization and reaching net-zero… We have identified a list of the highest-emitting suppliers directly supporting our operations. We expect those suppliers, who collectively contribute more than 50% of emissions globally to Amazon’s Scope 3 footprint, to provide a plan for how they will decarbonize their operations and demonstrate real progress over time.”
The same announcement also included the launch of a website with “previously proprietary information that will help other companies make meaningful progress toward net zero.”
As a companion site, Amazon also launched The Science Exchange, to help in the development of new solutions (with current work including information on alternative fuels, building materials, and packaging materials, along with cross-sector measurement tools, datasets, methodologies and industry mechanisms).
One example is the Amazon Sustainability Data Initiative, which lets anyone access large sustainability-related datasets while offering cloud grants “to those interested in exploring the use of AWS’ technology and scalable infrastructure to solve big, long-term sustainability challenges with this data.”
And Amazon also has several renewable energy initiatives:
- In May Amazon announced 650 megawatts (MW) of new renewable energy projects in Mississippi to fund two new data centers (in partnership with local utility company Entergy), as well as “funding for future upgrades to local grid and energy infrastructure over the next two decades.”
- There’s also Amazon’s $2 billion Climate Pledge Fund, a corporate venture program which has invested in 26 “emerging” climate-focused startups so far.
- Amazon’s order for 100,000 electric vans from Rivian is the single-largest EV purchase in the world, according to Kara Hurst, Amazon’s VP of worldwide sustainability in an interview with NBC News.
- Amazon’s corporate sustainability site notes the company is also expanding the use of zero-emission transportation beyond electric delivery vans to cargo e-bikes as well as on-foot deliveries.
These are just some of Amazon’s climate-focused initiatives. And as the work continues, Amazon’s announcement ended with a look toward the future that was decidedly optimistic…
“We love taking on big challenges and we’re proud of the progress we’ve made so far.”
