The Forces of Green Attack Cloud Computing

Greenpeace is worried that the huge new cloud computing industry will rely on old sources of energy. The growth and size of these IT infrastructures in not only large, it is growing as fast as that of any major industry that consumes a great deal of electricity. Greenpeace claims the companies have an obligation. The nonprofit’s hope is that the firms will use their leverage with energy suppliers to reorder the sources of that energy and force a shift toward more environmentally friendly technology like solar and wind. In its “How Clean Is Your Cloud” report Greenpeace observes:

By making better energy choices and demanding more from utility vendors, cloud companies have the opportunity to be a catalyst in driving utilities and governments toward the development of cleaner electricity generation that will ensure a truly green cloud for their long-term sustainability — and a greener grid for us all.

Greenpeace has even given green energy grades to the major tech companies. Amazon.com (NASDAQ: AMZN) and Apple (NASDAQ: AAPL) get poor grades. Yahoo! (NASDAQ: YHOO) and Google (NASDAQ: GOOG) get good ones as they press vendors for more use of renewable energy.

What the report neglects to mention is that almost all of the firms it analyzes are public companies. They have obligations to shareholders to keep gross margins high. This obligation effects employment levels. Companies with low margins are usually more prone to lower staff levels to make up for profit shortfalls. More expensive energy, even if it benefits the long-term health of the environment, will have to be, in almost all cases, a secondary consideration to financial ones. In other words, Greenpeace has asked may of these IT companies to act against their own self-interests.

Perhaps the Greenpeace goal is a noble one. The grades it has given these companies might shame some into putting more of their cloud servers on grids that rely to a some extent on the use of renewable energy. But the national grid does not run on renewables. It relies primarily on coal, other fossil fuels and, to some extent, hydroelectric power. Companies that need to make profits will not go far to change that if it costs them money.

Douglas A. McIntyre