Cloud Sustainability

IT leaders seeking information on the sustainability of cloud services are reliant on the assurances of vendors about the sustainability of their services. Those with queries and questions will be directed towards ESG reports or specific websites. These reports and pages are great at providing background and communicating targets and assurances but they're short on one thing that really matters - data.

All cloud vendors will cherry pick data to varying degrees to show themselves in the greenest possible light. This is why Computing now scrutinises sustainability claims closely.

In 2022, Computing conducted research into the sustainability credentials of the three hyperscale cloud giants and some other smaller cloud service providers. The research is updated annually.

Please scroll down the page for the 2022 matrix and a full explanation of each criterion.

A series of sustainability metrics were created and grouped into four categories: Standards and Policies, Emissions/Energy/Water, Waste/Circular Economy/Recycling and Transparency.

2023 Sustainability Matrix

Overall Score
Standards & Policies Signed to ISO14001 Weighting 1 Board level representation Weighting 1 Published Sustainability policy on website Weighting 1 UN Sustainable Development goals? Weighting 2 Science Based targets Initiative Weighting 2 Supplier/customer ecosystem engagement inc. Scope 3 reporting tools Weighting 3 External sign off for sustainability audit -  Weighting 1 Upstream supply chain sustainability - Weighting 3 Ambition of emissions reduction target - Weighting 2	Datacentre & Office Energy/Emissions/Water GHG emission reduction progress against Net Zero Target - Weighting 5 Carbon intensity per MwHour Electricity consumed 2 Renewable energy generation (distinct from RECs etc. and including initiatives) Weighting 2 Remote Working/teleworking included - Weighting 1 Sustainable commuting initiatives such as EV charging points - Weighting 1 LEED/BREAMM certification for office buildings - Weighting 2 PUE against global average of 1.57 (2021) - Weighting 1 Cooling Methods (air con/water) - Weighting 3 Evidence of initiatives to increase datacentre efficiency - Weighting 3 Water withdrawal - Weighting 3
Total score available 16	Total score available 23
Waste/Circular Economy /Recycling Paper consumption reduction  Weighting 1 Total waste generation Weighting 2 E Waste generation  Weighting 2 Landfill Diversion rate Weighting 2 Single use plastic reduction Weighting 1	Transparency Quality of Scope 3 Reporting - Weighting 3 Scope 2 & 3 LBM and MBM Reported -  Weighting 1 Clear target based GHG emissions reporting - Weighting 2 Carbon offset quality and transparency - Weighting 2 Accessibility & transparency of data overall -  Weighting 3 Use of third-party datacentres - Weighting 2
Total Score Available 8	Total Score Available 13
Total Score Available 60

 This year, Computing altered some criteria and weighting based on learnings since 2022.

Standards & Policies

• Board level representation: It is almost certain that an enterprise the size of the hyperscalers will  have a Chief Sustainability Officer on the executive board. It is becoming less useful as a true indicator of commitment, or as a differentiator. It is likely to be phased out altogether next year. One point
• UN Sustainable Development Goals: Very little changes from year to year in terms of alignment with these goals so the weighting has been dropped to reflect whether they have aligned to goals, and progress demonstrated. Two points
• Ambition of emission reduction target: Ambition of target matters, particularly given the urgency of emission reduction. However, most targets have been set for the long term and there is little value in comparing the same targets every year. Weighting has been adjusted to reflect any amendments or sub targets. Two points

The overall points available in this category have now been reduced from 20 to 16.

Datacentre & Office Energy/Emissions/Water

• Energy use intensity improvement has been removed as a criterion because almost none of the companies provide that data. This has been replaced with Carbon intensity per MwHour Electricity consumed which is a very important metric. Two points
• Renewable energy generation (as distinct from RECS) now includes provision for initiatives such as construction of a solar farm for example. Total points available reduced because on the whole, very little renewable energy is generated by any hyperscalers, and there is little variation in contractual instruments used. Two points
• Remote working/teleworking: New criterion Included to reflect the fact that much more widespread home and hybrid working has an impact on GHG emissions. One point
• Sustainable commuting initiatives: New criterion included to reflect the increase in EV ownership and to see whether hyperscalers have given serious through to reducing the emissions in their employee commutes which does after all, constitute a category of scope 3 emissions. One point
• The criterion of LEED certification has now been amended to include the Building Research Establishment Environmental Assessment Methodology (BREEAM) as well. BREAMM is an older accreditation for environmental sustainability and tends to be the method of choice in the UK. LEED is used more in the US. Two points
• PUE against global average of 1.57 (as of 2021.) This has had it's weighting reduced from two points to one because the extent to which it is a useful cross vendor comparative metric is contested. PUE was designed to compare the efficiency of datacentres at different points in time, not with each other. The differences between hyperscalers are so small as to be almost meaningless. There are much better metrics of energy efficiency available such as IT Equipment Energy Efficiency for servers, or Equipment utilisation for servers but no hyperscaler will publish this data. One point
• A criterion based on the drop in emissions from offices and commuting has been removed due to the fact that it is less relevant as lockdowns recede further into the past. A new criterion of "evidence of initiatives to increase datacentre energy efficiency," has been created to reflect the fact that all hyperscalers are investing and innovating in this area. Three points
• The criterion of Water Use Efficiency (WUE) has been replaced with simple water withdrawal. No hyperscaler provides WUE (the ratio of water use to the energy consumption of the servers.) Weighting is increased to reflect water scarcity. Three points

Waste/Recycling/Circular Economy

• Landfill diversion rate has been reduced by one point, because where this data is provided, ratios are very similar across the board so less useful as a differentiator. One point
• E-Waste generation has been reduced one point because some of the data is already captured in the landfill diversion calculation. One point
• Proportion of refurbished components used: New criterion included to assess commitment to circular economy. Refurbished and recycled components can perform as well as new ones in many cases - and sometimes even better. All cloud providers should be using at least some of these components. One point.

Transparency

• Carbon Accounting Published criterion removed as this is a basic requirement.
• Quality of Scope 3 reporting: New criterion included to assess the quality of scope 3 reporting which is voluntary and  variable. The majority of all emissions are in scope 3. Three points
• Carbon offset quality criterion amended to include transparency. Two points
• Use of third-party datacentres: New criterion included to reflect the fact that if cloud hyperscalers fail over to third party datacentres, multiple other metrics are affected. EG. PUE, GHG emissions, water withdrawal etc. It's an open industry secret that hyperscalers use third parties so transparency is critical if customers are to understand the impact on their emissions. However, confidentiality and security concerns make this very difficult. Two points

 

2022 Sustainability Matrix

Overall Score
Standards & Policies Signed to ISO14001 Weighting 1 Board level representation Weighting 2 Published Sustainability policy on website Weighting 1 UN Sustainable Development goals? Weighting 3 Science Based targets Initiative Weighting 2 Supplier/customer ecosystem engagement inc. Scope 3 reporting tools Weighting 3 External sign off for sustainability audit -  Weighting 1 Upstream supply chain sustainability - Weighting 3 Ambition of emissions reduction target - Weighting 4	Datacentre & Office Energy/Emissions/Water GHG emission reduction progress against Net Zero Target - Weighting 5 Energy Use Intensity Improvement - Weighting 3 Renewable energy generation (distinct from RECs etc.) = Weighting 3 LEED Certification for office buildings - Weighting 2 PUE against global average 1.59 - Weighting 2 Cooling Methods - air con/water - weighting 3 Did they bank 2020 emissions reduction or use to accelerate progress? - Weighting 2 Water Use Efficiency - Weighting 2
Total score available 20	Total score available 22
Waste/Circular Economy /Recycling Paper consumption reduction  Weighting 1 Total waste generation Weighting 2 E Waste generation  Weighting 2 Landfill Diversion rate Weighting 2 Single use plastic reduction Weighting 1	Transparency Carbon Accounting Published - Weighting 2 LBM and MBM Reported -  Weighting 1 Clear target based GHG emissions reporting - Weighting 2 Carbon offset quality specified - Weighting 2 Accessibility & transparency of data overall -  Weighting 3
Total Score Available 8	Total Score Available 10
Total Score Available 62

Explanation of chosen metrics

Each of the metrics chosen across all four categories was selected for its ability to provide insight to IT leaders. An explanation of how each criterion was chosen and weighted can be found below.

Standards & Policies

Vendors should provide clarity about which sustainability standards have been signed up to. Computing chose what we consider to be robust targets and assessed the degree of compliance or alignment. There are value judgements involved where Computing weighs up factors such as the ambition of climate targets based on the size and power of the organisation. These criteria are strong indicators of the sincerity and commitment to reducing  environmental impact.

ISO 14001 

ISO 14001 is the international standard of Environmental Management Systems, covering basics such as waste management and recycling. Any organisation serious about sustainability should be certified to this standard. One point

Board Level Representation

This criterion establishes whether sustainability has a seat at the executive table in the form of a Chief Sustainability Officer or similar. Different companies have diverse ways of managing accountability so there are more points available here to reflect different structures, and whether accountability for sustainability goes all the way to the top of the organisation.  Two points

Published Sustainability Policy on Website

Policy must set out targets which the organisation can be judged against, and easy to find within a reasonable number of clicks. One point

UN Sustainable Development Goals

There are 17 UN Sustainable Development Goals, a full list of which is available from https://sdgs.un.org/goals The goals cover a huge area, including the elimination of poverty and hunger, the reduction of gender inequalities and sustainable cities and communities as well as affordable and clean energy, climate action and life on land. Vendors were assessed on not just a statement that their sustainability policies aligned to these goals but on how they could demonstrate their progression against individual goals. Three points

Science Based Targets Initiative

The Science Based Targets Initiative (SBTi) provides a clearly defined pathway for organisations to reduce their GHG emissions. Targets are considered to be Science Based if they are in line with the goals of the Paris Agreement, limiting global warming to below 2°C and preferably 1.5°C. The names of companies who have made commitments, along with detail on whether these are near term, long term and/or Net Zero commitments are available via https://sciencebasedtargets.org/ . Vendors were judged on whether they had signed up to a target, which of the five stages of target they were at (Commit, Develop, Submit, Communicate, Disclose) and the detail of that target. Two points

Supplier/customer ecosystem engagement including Scope 3 reporting tools

The relationships between businesses and customers are complex, with networks of organisations involved in delivering cloud services to their end users. Scope three emissions include all indirect emissions (excluding those categorised as Scope 2) which occur across the whole value chain. This criterion is a wide-ranging category based partly on the extent to which cloud vendors engage with their eco systems of partners and also the extent to which tools are made available to customers to enable them to assess and reduce their own carbon footprints, and the vendors downstream emissions three points

External Sign Off for Sustainability Audit

Best practice for sustainability audits means the preparation of a GHG statement setting out emissions and offset calculations which is signed off by a professional accountancy firm in the same way as financial statements are. One point

Upstream Supply Chain Sustainability

This criterion is solely focused on upstream emissions, and the extent to which vendors attempt to quantify and reduce these emissions. Three points

Ambition of Emissions Reduction Target

This criterion is a value judgement of the commitment of vendors to reducing their environmental impact. It is informed by the preceding criteria as well as a judgement of the ambition of sustainability targets in comparison to the other vendors within the scope of this analysis. Four points 

Datacentre & Office Energy/Emissions/Water

This category assesses the sustainability of datacentres and office buildings based on widely recognised certifications, and metrics for GHG emissions, energy efficiency (including how much energy used is renewable) and water efficiency. The data used to inform these assessments tells us how sustainable an organisation truly is. Large gaps between ambitions and data indicate the application of greenwashing.

GHG emission reduction progress against Net Zero Target

This is a criterion with a wide scope. The GHG emissions of vendors are analysed not just in absolute terms, but in terms of their reduction over the last few years and in terms of progression to Net Zero emissions. Some vendors already claim to be Net Zero operations, so it is vital to understand whether this is due to a genuine reduction in the amount of GHGs being pumped out, or clever use of carbon markets. Maximum points can only be achieved by a demonstrable commitment to quantify and remove historical carbon emissions. Five points

Energy Use Intensity Improvement (EUI)

EUI is an efficiency metric calculated by dividing the total energy consumption of a building and dividing it by the floor area of the building. It is a useful indicator of efficiency. Three points

Renewable Energy Generation

This criterion examines what proportion of energy consumed by datacentres come from renewable sources. Most cloud vendors can only generate a fraction of the energy they consume from their own onsite renewable sources, so they offset their Scope 2 emissions (indirect emissions caused by the purchase of energy, steam, heat or cooling) with the purchase of renewable energy from other sources. Some of these sources are decidedly more sustainable than others and that is what this criterion assesses. Three points 

LEED Certification

Leadership in Energy and Environmental Design (LEED) is an environmental certification system developed in the US. Buildings are assessed across various different categories such as water efficiency, energy and indoor environmental quality and a score awarded at one of four levels - certified, silver, gold or platinum. Points were awarded based on the proportion of offices certified and the level of certification. Alternative certifications such as Building Research Establishment Environmental Assessment Method (BREEAM) which is a UK based sustainability rating system were also considered. Two points 

PUE against Global Average of 1.59

Power Usage Effectiveness (PUE) is a metric for measuring the energy efficiency of the datacentres powering cloud. It is determined by looking at the proportion of energy used by IT equipment itself as a proportion of overall energy consumption. PUEs have been on a downwards trajectory for years as processor technology became more efficient, but improvements in PUE now come in tiny increments. This is why PUE is compared to the global average for context when scoring rather than being considered in absolute terms. Two points

Datacentre Cooling Methods 

Cooling datacentres is a huge source of energy - and water consumption. Datacentres in temperate climes are able to utilise fresh air cooling if they are equipped accordingly, but many do not. Older style refrigeration cooling is energy intensive. Evaporative cooling is less so but can be water intensive. Closed systems and the use of rainwater, condensate or grey water can ameliorate this.

Vendors varied enormously in the quality and quantity of information provided about cooling and points were given for detailed information as well as the technologies used. Three points

Water Use Efficiency

This is a water-based equivalent of PUE. Given the quantities of water involved in cooling, and the fact that fresh water is becoming scarcer, this is an important metric. It's a ratio between the amount of water used and the energy consumption if IT equipment. Two points

2020 Emissions Reduction

In 2020, emissions from employee commuting, business travel more generally, and office-based activity plummeted. Some organisations looked at this reduction and used it to accelerate progress to a more sustainable future and brought forward existing targets or made them more ambitious. Others effectively banked the reduction in emissions without taking the opportunity to raise their level of ambition. Two points 

Waste/Recycling/Circular Economy

Cloud has the potential to drastically reduce e-waste, as customers no longer invest in their own infrastructure which has to be refreshed at regular intervals, but all cloud vendors hold a different position on the spectrum between basic recycling and embedding the principles of circular economy into core business processes, and infrastructure. This category of assessment is all about the extent to which cloud vendors are squeezing various categories of waste out of their value chain.

Paper Consumption Reduction

Paper waste is both preventable, and in many organisations, remarkably persistent. Technology companies should be ahead of the curve when it comes to the paperless office, with a high degree of digitization reducing the need for and consumption of paper. Whilst the majority of paper used in offices is collected for recycling, paper cannot be recycled indefinitely. The optimal solution is to use less of it. 1 Point

Total Waste Generation

This is pretty straightforward, with points being given for the provision of clear data and a reduction in the overall quantity of waste generated from year to year. Two points

E-waste Generation

Electronic waste is anything consisting of electronic components, plugs and cables. E-waste matters because it can contain toxic compounds such as mercury and lead which is problematic to safely dispose of. However, many of the non-ferrous (not containing iron) metals such as copper, gold and aluminium can be re used.  Points were given in the basis of separating e-waste as a category and the proportion recycled.

Landfill Diversion Rate

This is a useful environmental impact metric which simply measures how much waste is kept out of landfills, often via recycling and reuse schemes that already exist.  Landfill diversion rate is arrived at by dividing the overall waste figure by the proportion reused/recycled/otherwise diverted from landfill and multiplying by one hundred.  Two points

Single Use Plastic Reduction

Singe use plastic makes up approximately half of all plastic waste, and as most of us are well aware, a good deal of it ends up in our oceans and rivers. With technology vendors, many single-use plastics are to be found in office building canteens - cups, straws, stirrers etc. Many organisations have got rid of this sort of unnecessary plastic but not all.  One point 

Transparency

This category is concerned with transparency of data. Most vendors make Net Zero a cornerstone of their sustainability profiles, and all publish ESG reports. However, data quality varies and some vendors cherry pick and present data selectively. Carbon accounting is a dark art because GHG reporting protocols are sufficiently ambiguous as to leave room for interpretation. Carbon offset projects vary enormously in their effectiveness. The final criterion in this category is a value judgment based on the ease (or otherwise) with which journalists could find the hard data required.

Carbon Accounting Published

Full points were given in this criterion if full carbon calculations were included within the main body of ESG reports or as an easily accessible appendix, as opposed to being hidden in auditor letters of assurance or just available via CDP questionnaires. Full details of carbon offsets need to be provided with absolute emissions as well as net emissions accounted for. The Scope 3 categories being reported should be clearly set out. Two points

Scope 2 & 3 LBM and MBM Reported

In order for prospective customers to be able to see a full picture of carbon emissions, vendors need to publish both location and market-based emissions data. This is a crucial distinction. Location based emissions show how much carbon a company is putting into the air. Market based emissions display emissions net of offsets generated by energy purchases (and as explained in the Renewable Energy Generation criterion there is a significant variation in the quality and additionality of these instruments) for Scope 2 emissions, and other carbon offset projects for Scope 3 emissions. If only market-based data is provided, it is impossible to understand the true scale of emissions - and see how they have been offset. Two points

Clear, target based GHG Reporting

This criterion concerns how emissions data is presented. GHG emissions should be presented in full as well as net of offsets and compared to progress against targets set. Data should be easy to view in comparison to previous years to facilitate a clear understanding of progress over a longer period. If baselines have been adjusted for any reason, this should be explained. Two points

Carbon Offset Quality Specified

The importance of vendor explaining how they offset their Scope 2 emissions with renewable energy purchases has already been set out. His criterion concerns itself primarily with projects used to offset other indirect emissions. ESG reports often contain considerable content about offsetting projects, but sometimes fail to set out how exactly how they meet the critical metrics of additionality, leakage prevention, permanence and verifiability. 

Additionality means that offsetting project should actively remove CO² from the atmosphere and that these carbon savings would not occur regardless of the project. Permanence refers to the requirement that savings in GHGs brought about by the project cannot be reversed. Reforestation projects won't work if the forest gets burned to the ground or cut down at a later date. Equally, leakage occurs when, for example, reforestation in one part of a country leads to deforestation in another.

Verifiability means that carbon offset projects, and the carbon credits that they link to should be verified by a third party such as Verified Carbon Standard (VCS.)  Two points

Accessibility & Transparency of Data Overall 

This criterion is partly a value judgement of researchers, but also partly informed by the preceding criteria. It is a judgement of the quality of data, how easy (or otherwise) it is to access and how transparent the vendor is overall. Points are removed for making less favourable data harder to access, for omission of context and for misleading use of graphs. Three points