Spotlight on scope 3: Comparing emissions from AWS, Azure and GCP

Indirect emissions are on the rise - but not from all clouds

The second in our series of articles based on our cloud sustainability research takes an in depth look at indirect emissions.

We published the first in our series of articles setting out our cloud sustainability research a little over one month ago. The first article was a summary of the main findings of the research. Now, our task is to examine specific metrics in depth, and we begin with the category of indirect carbon emissions also known as scope 3 emissions.

Scope 2 emissions are also indirect but are deserving of a separate article to cover them alongside their offsets.

There are two criteria in the Energy/Emissions/Water category of the Sustainability Matrix which relate to indirect emissions. The first is the overall GHG Emission Reduction Progress against target. Although this criterion relates to both direct and indirect emissions, it is indirect emissions that make up between 85 - and 97% of the overall emissions total.

The challenge that tech giants have along with everyone else is that the indirect nature of the emissions makes them tricky to quantify. Whilst there are 15 categories of scope 3 emissions, the majority occur upstream in the first two categories – purchased goods and services and capital goods.

Built emissions are not a category of emission in themselves. They are a subgroup of scope 3 emissions, and the majority occur in the categories listed above. Given the pace of datacentre building globally and the clear demand for more, we decided that they merited their own criteria in the sustainability matrix.

Built emissions are those created by the extraction, manufacturing and transport of materials and those created during the building process itself. It also includes maintenance, repairs decommissioning and disposal.

Microsoft Azure

Microsoft took a little over half of the total points for overall emissions reduction and 1 of the 2 available in the build emissions category.

Scope 3 emissions actually made up 96.7% of their total emissions output in FY22. Purchased goods and services made up 47.24% of that number, and 30.97% came from capital goods. These are the areas that Microsoft need to be focusing on if the company is going to meet its 2030 net zero target.

Microsoft is careful in how it presents it's scope 3 carbon emissions. Market-based scope 3 emissions increased from 13,839,000 mtCO2e to 16,340,000 mtCO2e from FY21 – FY22. When carbon offsets are added the rate of increase reduces from 12,511,00 mtCO2e in FY21 to 12,571,000 in FY22.

However, when Microsoft adds in the carbon offsets and renewables it presents as a small overall decrease from 13,064,000 mtCO2e last year 12,998,000. But this has been achieved by offsetting scope 2 emissions. The integrity of that approach will be examined in an article focusing on transparency. Interestingly, the reduction comes about partly from revising historical data to take account of electricity consumed in leased datacentres in previous years.

However, the increase in scope 3 emissions were partly a result of "real-time device telemetry-based measurement." So Microsoft has partly just measured more accurately. The company also deserves credit for is trying to improve the measurement of built emissions. From the 2022 Environmental Sustainability Report:

"For capital goods, we are developing new methodologies to use product specific emissions factors for building materials from the Embodied Carbon in Construction Calculator (EC3). This methodology is under development (not yet reflected in Scope 3 reporting metrics) and, in combination with using EC3 in project decisions to track and reduce embodied carbon at each phase of construction, will enable us to reduce embodied carbon emissions on our construction projects as well as demonstrate those product-level reduction decisions in future reporting cycles."

Microsoft also updated its supplier code of conduct in 2022 to include independent third-party assurance of emissions data and to deliver a minimum 55 percent greenhouse gas (GHG) reduction by 2030. There is also a cross over into the concept of circular economy:

"We are focused on engineering carbon out of our value chain via the infrastructure equipment we use in the operation of our datacenters. Using LCAs and environmental product declarations, we partner with our suppliers to assess hotspots of embodied carbon in the equipment we purchase, so we can better understand how we can help reduce emissions in our supply chain. "

Microsoft is using its considerable weight to lean on suppliers and partners to reduce their emissions.

Google Cloud Platform

Google wins this section of the overall sustainability analysis for the simple reason that the company managed to genuinely decrease its emissions overall.

Overall carbon emissions are presented as having reduced from 11,371,200 mtCO2e to 10,183,400 mtCO2e. This is slightly misleading because scope 1 and 2 location-based emissions increased but the scope 2 category were offset more proportionally. However, overall scope 3 emissions dropped significantly from 9,503,000 mtCO2e in 2021 to 7,600,000 tCO2e in 2022. The equivalent figure in 2018 is 12,898,000 mtCO2e.

This significant reduction lies behind the fact that Google takes 4 points out of a possible 5.

Google also shows some progress with built emissions. The company works to incorporate low-GHG materials and adaptive reuse of existing buildings when it comes to new offices and datacentres. The company is also a founding member of iMasons Climate Accord, an industry coalition working to reduce the GHG emissions of the technical infrastructure underlying the digital economy. This involves collaborating with industry peers to highlight the importance of low GHG construction materials like green concrete.

In terms of other upstream emissions Google publishes a separate Supplier Responsibility Report which you can find here.

All suppliers are required to sign a Code of Conduct and are assessed and audited. All are expected to report environmental data and to submit data to CDP. In 2022 Google invited 222 suppliers to respond to CDP and 90% of them did. Google also hosts a Supplier Sustainability summit where targets are set and training is provided. Whilst the mechanisms for "deep supplier decarbonisation" will of course benefit Google by reducing their indirect emissions, it is still a leading example of a powerful company using its power to raise the standards of environmental reporting and to reduce emissions.

Amazon Web Services (AWS)

AWS comes out of the analysis badly for several reasons. The first is that Amazon doesn't break out AWS from the rest of its operation. Whilst Microsoft and Google don't do that fully, both provide some metrics which are specific to cloud infrastructure.

In common with Microsoft, Amazon presents a picture of a slightly reduced overall carbon footprint. However, an appendix to the main report where carbon accounting is located gives location-based carbon emissions (before any offsets are applied) as 56,509,397 mtCO2e. After offsets are applied a market-based measure of 54,977, 815 mtCO2e is given. Amazon rounds this up to 54.98mmtCO2e (million metric tons) in the main body of the report.

Amazon didn't make location data available in FY21 so a year-on-year comparison isn't possible but FY21 MBM scope 3 was 55.36mmtCO2e. Given that the location-based emissions FY22 were higher this year than market adjusted totals in FY21 it seems likely that the amount of carbon indirectly put into the air grew. To present this as a decrease requires an uplift in offset purchasing.

The lack of location-based data from FY21 enables a certain sleight of hand in Amazon's carbon accounting which is why they only get 1 point. This was awarded for a relatively small growth in emissions in comparison to company growth. If Amazon had provided an explanation of why indirect emissions grew (and we did ask) - perhaps due to better tracking - they would have been awarded another point here.

Since Computing began doing this research, we have been calling on Amazon to use its market dominance to help suppliers raise their environmental standards, and it seems these calls have been partially heeded. The following is an extract from the report covering FY22.

"As we know the first step in reducing emissions is to understand them, we will continue to work directly with our suppliers, and, starting next year, will update our Supply Chain Standards to require regular reporting and emissions goal setting. We'll also use our scale, investment, and innovation to date to provide our suppliers with products and tools that will help them reach their goals—whether those are transitioning to renewable energy or increasing access to sustainable materials. "

Whilst it will still be a couple of years until we see any metrics this is still encouraging. In the meantime, Amazon's tone remains curiously relaxed given the power the company wealds.

Where Amazon scores ahead of its competitors is on built emissions where it was awarded full marks for providing (forgive us) concrete examples of exactly how they are striving to reduce the embodied emissions of their datacentres. An extract from the report sets out the details:

"We are working with various suppliers on lower-carbon concrete options. For example, in Northern Virginia, AWS worked with building material provider Holcim to procure ECOPact concrete for several data centers. The concrete mix reduces carbon emissions by nearly 40% compared to standard concrete. AWS worked with American Rock Products (ARP), a CRH Company, to develop a more sustainable concrete mix for data centers across northeastern Oregon. ARP completed Environmental Product Declarations, which summarize environmental impacts across the concrete's lifecycle, for all products at their plants.

"Globally in 2022, we completed the construction of 16 data centers using lower-carbon concrete and 10 data centers using lower-carbon steel. We expect these numbers to grow considerably in 2023."

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