Closing the Emissions Gap: Data Center Sustainability

Data Center Sustainability

Greenhouse gas (GHG) emissions are the primary contributor to climate change, and companies, governments and the general public have all taken an active interest in aggressively minimizing these emissions. Investors, consumers and other stakeholders are increasingly expecting companies to report their GHG emissions and reduction goals, in order to assess their performance compared to competitors, gauge their preparedness for existing and anticipated regulation and ensure that the company’s values are aligned with their own.

Accurate, transparent reporting of emissions data is becoming a standard expectation across industries, including data centers. In addition to a data center operator’s internal emissions tracking and reporting, customers and partners that rely on these data centers as part of their business operations require access to this GHG emission data as well, incorporating them into their own reporting. Data centers are feeling pressure to not only operate sustainably, but also conduct comprehensive reporting to relay this information to their stakeholders.

However, despite the increased demand for data center emissions data, many reports have gaps in their coverage. Among these gaps is the reporting of scope 3 emissions (as defined in the GHG Protocol), which are the emissions resulting from activities from assets not owned or controlled by the reporting data center company itself.¹ For data centers, scope 3 emissions can be tied to activities such as facility construction, energy sources, cooling services, and uninterruptible power supplies (UPS) including energy storage systems.²

As supply chain sustainability draws increased attention from stakeholders, scope 3 emissions data need to be included in carbon accounting to provide an accurate assessment of a data center’s climate impact. Once this data is widely available, companies can ensure actions to reduce these emissions, including improving the sustainability of their energy storage practices using battery chemistries with low climate impact such as nickel-zinc (NiZn) used in UPS Battery Cabinets.

The Importance of Scope 3 Emissions Reporting

Oftentimes, companies will focus their efforts on tracking and reporting emissions directly tied to their own operations and electricity consumption. These include scope 1 emissions, which are direct GHG emissions that occur from sources that are controlled or owned by an organization, as well as scope 2 emissions, which are indirect GHG emissions associated with the purchase of electricity, steam, heat, or cooling.

Scope 1 and 2 emissions, however, fail to capture the emissions that a company is responsible for that occur away from its own facilities. Scope 3 emissions, which represent emissions associated with a company’s value chain, often represent the majority of an organization’s total GHG emissions.⁴

For most companies, 65-95% of their carbon emissions can be attributed to their supply chain and end use, but may ultimately not be reported if scope 3 emissions are excluded from carbon accounting.⁵

Scope 3 emissions often represent the majority of an organization’s total GHG emissions.

Thus, reporting and action focused solely on scope 1 and 2 emissions are incomplete, and don’t paint an accurate picture of a company’s carbon footprint.

Despite the significance of scope 3 emissions in relation to a company’s overall carbon footprint, scope 3 emissions quantification is currently not required by the GHG Corporate Protocol.⁶ Due in part to its optional nature and complexity, a low number of companies are reporting scope 3 emissions. According to MSCI, only 18% of the constituents of their investable market index were reporting scope 3 emissions in 2020, with even lower rates of reporting for the specific categories within the scope 3 accounting methodology.⁷ This lack of information on emissions associated with companies’ supply chains results in a significant gap in stakeholders’ ability to understand and compare carbon footprints.

Although the level of transparency is currently low, scope 3 emissions represent a significant opportunity for GHG emission reduction. Leaders are emerging, as over 3,000 companies have reported scope 3 emissions under the Carbon Disclosure Project, according to investor sustainability advocate Ceres.⁸ Companies that report on their scope 3 emissions stand out from their competitors who lag behind in their disclosure, and are able to identify and act upon areas of their supply chain that offer room for improvement. The measurement of these emissions is necessary for goal setting and action, and companies taking the lead can take advantage of the economic, reputational, and environmental benefits before others.

Leaders in reporting and acting on scope 3 emissions are also better equipped to manage their preparedness for existing or potential regulations. Starting in 2023, German companies will be responsible for social and environmental issues tied to their global supply chain networks.⁹ Investors and other stakeholders are paying attention to these global developments, and are seeking reassurance that companies are managing any risks they face should such regulations be enacted in the U.S. To improve performance and preparedness, the initial step that needs to be taken is to gather these data and improve transparency.

The Right Batteries Can Reduce Data Center Scope 3 Emissions

As data centers and their customers look to meet the growing expectation to disclose scope 3 emissions, they can turn to their energy storage systems that are part of the UPS as an opportunity to establish a lower carbon footprint compared to their competitors. Energy storage is an increasingly significant part of a data center’s business operations, and the battery chemistry tied to a data center’s UPS offers significant trade-offs in terms of the sustainability of their supply chain and environmental footprint. As data centers and their customers look to assess their scope 3 emissions, the battery chemistry used in their UPS systems should be measured, incorporated into goals and seen as an opportunity to stand out.

NiZn batteries used in the ZincFive BC 2 UPS Battery Cabinet represent a more sustainably sourced and environmentally friendly alternative to other batteries used in data centers such as lead-acid and lithium-ion. Boundless Impact Research and Analytics performed a life cycle analysis of lead-acid, lithium and nickel-zinc batteries to prepare a scope 3 emissions Climate Impact Profile of these battery types. For the first time, energy storage users can compare and utilize scope 3 level environmental data comparing lead-acid, lithium-ion and ZincFive’s NiZn batteries along key performance indicators including GHG emissions, water footprint, energy footprint, and hazardous material requirements.¹⁰ In multiple ways, ZincFive’s NiZn batteries proved a more climate-friendly option:

Material Use

Nickel and zinc are four and five times more abundant in the earth’s crust, respectively, than lithium and lead. In addition, while lead exposure is a global health concern and lithium’s reactivity to air and water makes it a fire hazard, nickel and zinc are safer and non-flammable.

Greenhouse Gas Intensity

Since nickel and zinc sourcing require fewer emissions, ZincFive’s estimated GHG Footprint is roughly half of its competitors. The GHG Footprint of ZincFive’s battery is 63% lower compared to lithium-ion batteries, 37% lower than lead-acid batteries.

Carbon Payback Time

Carbon Payback Time (CPT) measures the time it takes for a battery to offset its GHG Footprint by supporting more renewable resources to supply the electricity grid. NiZn chemistry’s CPT is between 0.16 and 0.21 years – four times faster than lithium-ion and lead-acid batteries.

Volatile Organic Compounds (VOCs)

Emitted as gases from solids – including those used to produce lithium-ion and lead-acid batteries – VOCs are infamous for causing short-and long-term adverse health effects. A healthier alternative, the ZincFive battery does not use VOCs in production.

Water Footprint

Even including water requirements for raw material extraction, the ZincFive battery still demands 96% less water than the average lithium-ion battery.

Energy Footprint

The energy footprint for ZincFive’s battery is 23-33% less than lithium-ion and lead-acid pure lead batteries.

Boundless Impact’s assessment identified and analyzed the Carbon Return on Purchase (CROP), GHG Footprint, Energy Footprint, Water Footprint, Volatile Organic Compounds (VOC) Footprint, Carbon Payback Time (CPT) and the Levelized Cost of Storage (LCOS) of ZincFive’s and other battery chemistries.

Source: Boundless Impact Research & Analytics

The results of a formulaic comparison measuring relative performance across all metrics showed that ZincFive’s technology scores a 9.4 out of 10 impact score on its overall performance, with higher scores representing higher positive environmental impact.

Conclusion

While not currently required, increased demands for scope 3 emissions transparency are gaining momentum, driven by pressure from investors, regulators and the general public. Data centers who stay ahead of the competition in reporting and addressing scope 3 emissions will attract customers and investors who are seeking comprehensive disclosure and commitments to sustainability. This not only applies to the sustainability of the data center companies themselves, but to the climate impact of the customers who utilize these data centers as part of their operations, such as with colocation facilities. Improvements to data center sustainability can have a chain reaction of benefactors.

As efforts continue to make scope 3 accounting more straightforward and widespread, recent research shows that a new opportunity for data centers to reduce their climate impact is through their UPS batteries. ZincFive’s NiZn batteries have shown advantages across a myriad of sustainability metrics, and offer users a method of minimizing their supply chain impacts. Moving forward, a set of sustainability criteria for battery sources can be established and adopted by the energy storage industry, assisting in the comparison of existing battery chemistries as well as potential ones still under development.

Already one of the largest industrial adopters of green energy, data center operators’ logical next step as energy sustainability leaders is to pioneer accounting and reduction of scope 3 emissions, setting an example for other industries worldwide. By helping quantifiably reduce scope 3 emissions, ZincFive’s NiZn batteries let early reporters showcase that advantage.

ZincFive BC 2 UPS Battery Cabinet

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Citations

1 https://www.epa.gov/climateleadership/scope-3-inventory-guidance/

2 https://www.datacenterdynamics.com/en/broadcasts/london/2020-virtual/case-study-scope-3-emissions-and-next-generation-sustainable-data-centers/

3 https://www.epa.gov/climateleadership/scope-1-and-scope-2-inventory-guidance

4 https://www.msci.com/www/blog-posts/scope-3-carbon-emissions-seeing/02092372761

5 https://www.cnbc.com/2021/08/18/apple-amazon-exxon-and-the-toughest-carbon-emissions-to-capture.html

6 https://www.nature.com/articles/s41558-020-0837-6#ref-CR14

7 https://www.msci.com/www/blog-posts/scope-3-carbon-emissions-seeing/02092372761

8 https://www.cnbc.com/2021/08/18/apple-amazon-exxon-and-the-toughest-carbon-emissions-to-capture.html

9 https://www.cnbc.com/2021/08/18/apple-amazon-exxon-and-the-toughest-carbon-emissions-to-capture.html

10 ZincFive Climate Impact Profile