The Growth of Data Centres
As the world becomes increasingly digitalised, data centres have become a critical part of our infrastructure. These power-hungry centres are growing exponentially as we embrace AI, cryptocurrency, and cloud computing.
But the operators of these centres face both economic and sustainability challenges.
It’s estimated that electricity demand from UK centres alone will jump six-fold over the next decade. According to the BBC, by 2026, data centres globally will be consuming the same amount of electricity as Japan.
Solar Solutions
At Shawton Energy, we’re acutely aware of the challenge – and the fine balancing act – that operators and tech companies face.
Our high-quality commercial solar solutions are recognised across a range of industries because we develop tailor-made solar power systems.
Further to that, we’re conscious of the need to reduce dependence on conventional energy sources and protect our customers from volatile energy market fluctuations.
Data centres powered by custom solar system installations not only help meet carbon reduction and financial targets, but they also allow data centres to be turned into efficient energy sources without compromising on space.
The UK is home to one of the world’s largest financial services sectors, and the technology which powers the sector is increasingly generated by greener sources.
Earlier this year, Microsoft admitted its energy use, related to its data centres, was hampering its plans to reach carbon negativity by 2030.
The challenge of balancing financial commitments, a green agenda, fluctuating prices, available space, investor expectation and forecasting general power consumption can leave businesses in a state of paralysis.
Leading the way globally, tech giants like Google, Microsoft, Meta, and Amazon are aligning their growing energy usage with their corporate sustainability goals. From this, we’re seeing many businesses in the UK following suit.
Businesses know they need to act, but which aspect of change should they prioritise?
One solution is a Virtual Power Purchase Agreement.
What is a Virtual Power Purchase Agreement?
A Virtual Power Purchase Agreement (VPPA) is a financial contract that enables businesses to support renewable energy generation without physically receiving the energy.
A business enters into a VPPA with a commercial solar developer, agreeing to purchase the electricity generated by a specific project at a fixed price over a long-term period, typically 10 to 20 years.
However, the electricity generated by the project is not directly delivered to the business. Instead, it is sold into the grid at the prevailing market price.
A VPPA can help empower businesses when it comes to energy supply, by reporting emissions, improving brand image, and attracting investors.
One key benefit of a VPPA is that it provides businesses with a hedge against energy price volatility. By locking in a fixed price, businesses gain financial predictability, even though they may need to make payments or receive payments based on market fluctuations.
Pharmaceutical giant GSK signed a VPPA with Spanish renewables company IGNIS, earlier this year, to facilitate the supply of 200GWh of renewable energy certificates each year, representing 72,000 tonnes of CO2 emissions.
Energy use can contribute up to 20% towards the cost of goods in the pharmaceutical sector and companies like GSK are demonstrating how emerging approaches to power supply and management can be taken forward.
What next?
In a fast changing world, solar provides answers to many critical business issues regardless of size or sector.
Get in touch with the Shawton Energy team today to find out how we can help you achieve your objectives.
