You can’t get to your destination if you don’t know where it is. That’s pretty much the problem with corporations decarbonizing. Their targets are way off, and the climate situation is only being exacerbated. The Science-based Targets Initiative (SBTi) ICT (Information and Communication Technology) guidelines can make it easier for data centers to set the right emissions targets.
The tech sector, with data centers and network operators at the forefront, bears a significant responsibility for the high levels of greenhouse gas (GHG) emissions we see today. With technologies like Artificial Intelligence requiring more power than ever before, data centers will have an even bigger carbon footprint if they don’t set actionable targets.
This article talks about SBTi ICT target-setting guidelines for data center and network operators and how these guidelines can help such companies reduce their carbon footprint.
What is SBTi? What are Science-Based Targets?
The Science-Based Targets initiative (SBTi) is a collaborative effort of several major non-profit organizations: CDP, the UN Global Compact, the World Resources Institute (WRI), and WWF. It was formed in 2015 with a mission to empower businesses to set ambitious goals for reducing GHG emissions.
These goals are called science-based targets, as they’re aligned with the latest climate science. Notably, they are also based on the Paris Agreement's objectives, which aim to limit global warming to well below 2 degrees Celsius, ideally 1.5 degrees Celsius by 2050. Climate scientists have determined that that’s the threshold to avoid disastrous and irreversible environmental changes.
The SBTi offers a framework and resources to guide businesses through the target-setting process. It also independently assesses and approves companies' targets to ensure they meet the scientific criteria. Over 5,000 companies worldwide have used SBTi to set targets and track them.
By setting science-based targets, companies gain a clear roadmap for reducing emissions and contributing to a more sustainable future. This initiative benefits the environment and can enhance a company's profitability and competitiveness in the transition to a net-zero economy.
SBTi ICT Guidelines
Since its foundation, SBTi has created general and sector-specific frameworks for setting targets. The Corporate Net-Zero Standard provides generalized guidelines for enterprises, regardless of industry or niche. Sector-specific guidelines, on the other hand, are more elaborate and consider areas and processes specific to that sector.
The SBTi ICT guidelines were introduced specifically for the information and communication sectors. They mainly apply to data center, fixed, and mobile network operators.
These guidelines cover target-setting for all three emission scopes (Scope 1, 2, and 3 as per the GHG Protocol). Like other sector-specific SBTi guidelines, the ICT framework also involved stakeholders from the industry. SBTi’s guidelines undergo a feedback phase before being finalized and are updated to reflect new requirements or technologies.
Up until now, there has been no SBTi-approved sectoral target-setting approach for companies in the ICT sector. This guideline fills that gap and supports ICT companies in setting 1.5°C aligned targets in line with climate science.
Within the ICT framework are subsector guidelines that help the three targeted subsectors calculate their emissions targets for net-zero status. Companies can set a baseline year and use that to set both near and long-term targets. However, the ICT guidelines have set the trajectory for 2030 (again in line with the Paris Agreement).
For Scope 3 targets, the ICT guidelines refer to SBTi criteria document, which is a more general framework for setting value chain emission targets. SBTI recommends organizations whose Scope 3 emissions make up more than 40 percent of their total emissions to set Scope 3 targets.
How Can Data Centers Use SBTi ICT Guidelines?
Data centers are responsible for two to three percent of global emissions. Needless to say, their operators have a part to play. Whether hyperscalers operate huge facilities or other enterprises operate smaller data centers, the SBTi ICT guidelines can be useful in setting well-researched and accurate targets.
Setting SBTs isn’t necessarily a compliance requirement, so it’s more of a voluntary move for organizations. However, because of the intensity of the climate emergency, climate advocates highly encourage this move. A United Nations report found that national climate action plans remain insufficient for net zero goals. In other words, countries simply aren’t doing enough to achieve the desired targets by 2030 and 2050.
Targeting Scope 1 and 2 emissions for data center operators is fairly easy, as most of them are based on energy consumption. However, they also need to target Scope 3 emissions, particularly under these two categories: purchasing goods and services and using sold products.
Data center operators spend significant capital to acquire infrastructure that has associated emissions. With SBTi guidelines, they can also target such emissions, which often go unchecked.
While data center operators can use the guidelines to independently set targets, they can have the SBTi assess and approve them. These targets are then made public, and progress can be tracked by both the operator and SBTi.
SBTi Buildings Guidelines
Another SBTi sector-specific guideline worth mentioning is the Buildings sector guidelines. These are still under development as the SBTi seeks feedback from industry stakeholders. While this particular document will provide information for the building sector, it may be useful for buildings other than the data center facility associated with its operations or new construction of data facilities.
Why Science-Based Targets Are Important
Companies with a sustainability-first mindset are setting achievable, science-based targets that can have a positive environmental impact. This has both environmental and business benefits.
- Combating Climate Change: SBTs are grounded in scientific evidence and ensure that emissions reductions align with the Paris Agreement's goals of limiting global warming. Science-based targets ensure that you’re zeroing in on areas that can have the most impact.
- Business Resilience: As regulations and consumer demands shift towards sustainability, companies with SBTs are better positioned to adapt. Plus, it’s a viable way to future-proof operations against stricter regulations and potential carbon taxes.
- Innovation and Efficiency: Setting and achieving SBTs often leads to innovation. Businesses are incentivized to develop new technologies and processes that reduce their environmental footprint. For instance, data centers can target cooling needs with less energy-intensive solutions. This can lead to increased efficiency, reduced waste, and, ultimately, cost savings.
- Investor Confidence: According to Morgan Stanley, investors increasingly prioritize companies that are committed to sustainability. SBTs signal a company's long-term vision and understanding of the environmental risks and opportunities of the future.
- Competitive Advantage: Consumers are also becoming more environmentally conscious, seeking sustainable products and services. Data centers with SBTs can differentiate themselves as leaders in their field, attracting companies who value environmental responsibility. This translates into a potential competitive edge in the marketplace.
Going Green, the Science-Backed Way!
Developing SBTi ICT guidelines is a significant step forward for the ICT sector. These guidelines provide a clear roadmap for mobile network operators, fixed network operators, and data center operators to set emissions reduction targets aligned with the urgent need to limit global warming.
By embracing SBTi and its sector-specific guidance, ICT companies can ensure their operations are aligned with a sustainable future while reaping the benefits of increased efficiency, competitiveness, and a strong reputation for environmental responsibility.
At PivIT, we always encourage our clients to embrace sustainable practices and use tried-and-tested methods for decarbonization. Focusing on the circular economy, our services help data centers and IT enterprises reduce their spending, impacting Scope 3 emissions.
FAQs
What are SBTi Scope 3 target requirements?
SBTi has set criteria for setting targets for reducing Scope 3 emissions. If the value chain emissions represent more than 40 percent of total emissions (Scope 1, 2, and 3), companies should set targets that can be reduction or supplier engagement-focused. These targets should collectively target at least 67 percent of the Scope 3 emissions.
Does SBTi allow offsets?
Early on, SBTi guidelines didn’t recommend offsets as a strategy to achieve emission targets. However, recently, the organization has allowed offsets to be used to mitigate Scope 3 emissions. This motion has been criticized by climate advocates who believe offsets aren’t a real solution and that it will lead to less pressure on suppliers to report and reduce their emissions.
What is the carbon footprint of the ICT industry?
According to Allianz, the ICT industry is responsible for 1.8 to 2.8 percent of global emissions. That said, with the embrace of renewable energy, the ICT industry can cut its emissions significantly.
Are Science-Based Targets mandatory?
The SBTi provides guidelines for setting science-based targets that organizations can follow voluntarily. No regulations or laws require companies to set SBTs based on the SBTi guidelines. However, many social and climate organizations highly recommend setting SBTs.