Chinese tech giants lag behind in renewable energy adoption, and AI will push them further behind

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China’s leading technology companies have made limited progress in meeting their renewable energy targets as the sector’s energy consumption is expected to rise due to demand for artificial intelligence (AI) and cloud services, according to a report by Greenpeace East Asia. The group urged the tech giants to take stronger measures to tackle climate change.

The environmental organization published a report Thursday tracking the use of renewable energy by China’s 25 largest cloud providers and data center operators, which together account for more than half of the country’s cloud market and more than 60 percent of its data center market.

Alibaba Group Holding, Tencent Holdings and Baidu took the top three spots in the ranking of 10 cloud providers for their renewable energy procurement, carbon reduction measures and targets, and data transparency. GDS, Chindata and VNET Group topped the list of 15 data center operators for their renewable energy procurement.

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“Over the past two years, some top companies have reported significant breakthroughs in their renewable energy consumption,” said Lyu Xin, climate and energy campaigner at Greenpeace East Asia. “However, progress has been uneven across the sector.”

According to Greenpeace, renewable energy purchases by top Chinese tech companies have increased significantly over the past two years. Five of the 25 companies in the study – Alibaba, China Telecom, Chindata, GDS and Tencent – ​​reported annual renewable energy ratios of more than 10 percent last month, compared to only one company, GDS, in the Study from 2022.

The report also finds that only eight of these 25 companies have committed to 100 percent renewable energy use by 2030, and only six companies have set targets to be carbon neutral for their direct and indirect emissions from purchased energy, known as scope 1 and scope 2 emissions, by the end of the decade.

Greenpeace has called on all technology companies to aim for 100 percent renewable energy and carbon neutrality by 2030. Companies must also include scope 3 emissions (indirect emissions in their value chain) in their carbon neutral targets, the environmental organization said.

According to Greenpeace, it is crucial that technology companies rapidly expand their use of renewable energy, given the exponential development of generative AI. This development could cause an explosion in data center construction and require enormous amounts of energy.

According to research from Goldman Sachs, AI is expected to increase energy demand for data centers globally by 160 percent by 2030 compared to 2023.

According to the investment bank, data centers are expected to account for 3 percent of global electricity consumption by 2028 and 7 percent by 2035, or about 3,100 terawatt hours over a decade. Macquarie.

In China, which has the world’s largest 5G network and one of the world’s largest data center industries, carbon emissions from digital infrastructure are expected to increase 152 percent to 310 million tons in 2035, compared to 2020, according to a report published by Greenpeace in 2021.

According to the group, the sector is expected to consume 782 billion kilowatt-hours of electricity by 2035, representing about 5 to 7 percent of national electricity consumption, compared to 2.7 percent in 2020.

As China approaches the 2030 deadline to cap nationwide carbon emissions, Beijing has taken a number of measures. policy to decarbonise the energy-hungry digital infrastructure sector, including cloud services and data centres.

Ministry of Industry and Information Technology of China mention the sector as a key target for carbon reduction alongside traditional high-emitting industries by 2022. The ministry ordered data center operators and telecom providers to conserve water and electricity, locate facilities in areas with abundant renewable energy, and develop low-power facilities and equipment.

This article originally appeared in the South China Morning Post (SCMP)the most authoritative voice covering China and Asia for over a century. For more SCMP stories, explore the SCMP app or visit the SCMP’s Facebook And Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2024. South China Morning Post Publishers Ltd. All rights reserved.

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