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I don't totally understand the implications of this (although clearly they're not good): The most important tools in this “creative accounting” when it com

I don't totally understand the implications of this (although clearly they're not good): The most important tools in this “creative accounting” when it comes to data centers are renewable energy certificates, or Recs. These are certificates that a company purchases to show it is buying renewable energy-generated electricity to match a portion of its electricity consumption – the catch, though, is that the renewable energy in question doesn’t need to be consumed by a company’s facilities. Rather, the site of production can be anywhere from one town over to an ocean away. The "doesn't need to be consumed by a company's facilities" part makes it sound like you can buy these credits without actually using them(?), but the "site of production" part makes it sound like you're buying credits and cashing them in, just not in the same location as your data center. So I'm not sure if the situation here is that you have a data center in Seattle, but you're buying solar power generated in Kansas City, and you may or may not have a corporate office or something in Kansas City to use it.

Arnt 2y ago
Close. The office in Kansas City wouldn't use it, if that office existed. Suppose you can get solar power in Kansas City, but can't transport it to Seattle, maybe due to lacking interconnect capacity, maybe lack of contracts among the power companies, it doesn't matter. What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas and buy fossil power in Seattle. The Guardian thinks it's creative accounting, IMO it's a fair and good hack: When you open a new site and use that hack to buy power for the new site, the corresponding new power generation is solar. It's just solar with two additional accounting hops. There are other variants of the same hack.
- danpalmer 2y ago
  It's a useful stepping stone, and probably better for the environment than not doing it, but ultimately the emissions still happen. The sad reality is that in some areas there is no emissions free energy to buy no matter how much you want to. Some would say not to put datacenters there, but if there are customers wanting them I understand why companies do it (even if I don't agree).
  - Arnt 2y ago
    Well… the emissions happen so long as someone else wants to buy fossil power, but you can hardly blame the DC company for some other company wanting to buy fossil power. In the case where I came across it, the problem was contractual. Only one vendor could supply power to that site. So by applying that hack, ① new renewable energy generation was built ② a conventional power plant lost a contract with Otherco and ③ another conventional plant gained a contract of the same size. After a while the contractual problem was solved. IMO it doens't make sense to choose site based on something as flimsy as a contract. Contracts are changeable on a timescale of months or years, buildings last longer.
  - blueflow 2y ago
    If the emissions still happen, its not useful in doing anything for the climate.
    - Arnt 2y ago
      What are "the emissions" in your sentence? When a new server boots in such a DC, the increased power usage is matched by increased regenerative power generation, so what are "the emissions" that "still happen"?
      - blueflow 2y ago
        > and buy fossil power in Seattle.
        dialup_sounds 2y ago
        This is offset by the amount of fossil power you replaced in Kansas by selling the clean power you purchased there. The net emissions are zero.
        blueflow 2y ago
        The "net emissions" are zero because "having 1 fossil plant running somewhere" is your baseline. You only move the location of that plant around.
- spondylosaurus 2y ago
  Ahhhh, that makes more sense! Thanks for explaining :)
- jltsiren 2y ago
  I think it's useful to look what happens at the margin. If you are connected to the grid, or could be reasonably connected, all the power you use comes from the source with the highest marginal costs in the region. Most of the time in most places, that means a power plant burning fossil fuels. If the demand goes down permanently, that power plant will be the first to shut down. If you buy existing clean energy to compensate for your emissions, overall emissions will remain the same, no matter which hacks or accounting tricks you use. That clean energy would be produced and sold anyway, because the marginal costs are so low. If you can't avoid emissions and want to compensate them, you must invest in new renewable capacity that replaces fossil fuels somewhere.
- SiempreViernes 2y ago
  If you buy so much solar that it leads to expansion of facilities, this "hack" will have you buying so much fossil power you are in effect subsidising the other fossil customers and thus prolonging their use of fossils. You definitely shouldn't count that power as 100% renewable. It only works as a clean bypass of you buy so little you don't impact the local fossil market, but this is a discussion about large data centres so that's basically never satisfied.
  - Arnt 2y ago
    That argument applies to my personal electricity bill too. I buy my power from a company that supplies 100% regenerative power and gets most of its power from new generation facilities, 350 of them so far. Those 350 deliver power to about a half-million people, which obviously took market share away from existing fossil plants and pushed the market prices down. So by that test, what action does not prolong the use of fossil fuel? You're making the test much too strict.
  - bryanlarsen 2y ago
    You've got that backwards. If you're using a solar credit from KC in Seattle, you're subsidizing the cost of power in KC. Solar generation is built in KC, but demand is unaffected. Therefore the price of power drops in KC, crowding out fossil there and lowering the price of green power. In Seattle you've increased demand without increasing generation, raising the price there. Yes, fossil generators may be built to satisfy this new demand, but that's unlikely in 2024. In Seattle in particular, excess demand is generally met by buying hydro from BC.
- oarsinsync 2y ago
  > Close. The office in Kansas City wouldn't use it, if that office existed. Suppose you can get solar power in Kansas City, but can't transport it to Seattle, maybe due to lacking interconnect capacity, maybe lack of contracts among the power companies, it doesn't matter. What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas and buy fossil power in Seattle. If I’m understanding this correctly: 1. You buy 1MW of solar power in location X, and don’t use it. 2. You sell 1MW of emissions producing power in location X, that someone else uses 3. You buy 1MW of emissions producing power in location Y, and use that. Net result: 2MW of emissions producing power used, 0MW of solar power used, and a claim of net-0MW of emissions produced? Yes, it’s a “clever hack”, but accounting sleight of hands are just that. Most charitably magic, less charitably outright falsehoods. > IMO it's a fair and good hack: When you open a new site and use that hack to buy power for the new site, the corresponding new power generation is solar. It's just solar with two additional accounting hops I don’t understand how you got to this outcome from the first position. Can you help me understand what steps I missed for this to actually have good outcomes resulting in solar power actually being used? I’d love to be wrong and for this to actually be actually good outcomes combined with clever accounting - those are absolutely the most satisfying solutions, both to design and read about (for me personally, anyway): where clever people are coming up with creative solutions to solve bureaucratic bullshit, while also achieving good outcomes. EDIT: Child comment has helped me spot the error in my comprehension leading to incorrect math: “ What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas” - I didn’t read ‘same power’ properly in my first read. I’ve left my comment as-is despite it now being completely wrong as a result of that, and glad to have been wrong
  - bastawhiz 2y ago
    > 0MW of solar power used No, the 1MW solar power was used. It was used by someone who believed that it created emissions. But the emissions were instead produced in Seattle rather than Kansas. The accounting relies on the person buying power in Kansas not to care that it's fossil fuel power that they're purchasing. They know that there's emissions from their power use, but they don't know where those emissions are.
    - 2y ago
pjc50 2y ago
Some people refer to these as "indulgences", like the certification of having your sins forgiven that the Catholic Church used to sell before Martin Luther (and half of western Europe) got mad about it. The effect is to either shift the attribution of emissions to some other company who doesn't care, or to cause renewables to be double-counted. Consider a toy grid, with two users A and B and generators C(lean) and D(irty). All connect to the same point. A buys a certificate saying that 100% of their energy comes from C. But that does not inform B about anything - they might reasonably look at the grid and then claim that 50% of their energy is clean, when in fact by arithmetic 100% of it is dirty because all the clean stuff has been bought by A. See e.g. https://industrydecarbonization.com/news/the-trouble-with-european-green-electricity-certificates.html https://industrydecarbonization.com/news/the-trouble-with-eu...
- Ekaros 2y ago
  Also I have always wondered about this model. Electricity is only fungible in the moment, not on longer scale. So let's say C goes entirely offline. How many of A instantly stop using any power? B can happily use the D as overall on long term it will balance out, but A should not be able to use any power.
  - pjc50 2y ago
    Electricity is momentary, but REICs are not, so you can just buy some more from a different time period. It averages out, right?
- maxerickson 2y ago
  The toy grid example is cute, but in practice, billing does happen.
joshvm 2y ago
Having a grid makes it pretty difficult to "buy clean energy" because all generation is sort of laundered together. If you pay for a clean energy supplier, obviously there is no way to force that you only get electrons pushed by solar or whatever. You could change your supplier from week to week and nothing in the grid infra changes. But the market overall determines who can sell power, so if nobody wants to buy from coal, the coal plants won't get paid (or it becomes financially unviable to generate). If you have on-site generation then this is a bit different because you can at least reduce your grid consumption. But otherwise it's not hugely different to buying carbon offset credits and assuming the trees will exist in 100 years.
Cthulhu_ 2y ago
Sounds like carbon emission rights which are freely traded from companies that just get them without using them; iirc Tesla earned a lot of money selling their emission rights. I mean on paper it's a good idea, but there's not enough restrictions. Emission rights, for example, should be bought (from the government) in the first place, at an exponential price (so the more you need the more you pay). Supply should be reduced every year, with a goal being zero. They should not be tradeable across country (or in the case of the US, state) borders. Same with these renewable energy certificates mentioned, the further away the source, the higher the price should be. But that's all bookkeeping shenanigans; it doesn't mean that e.g. data centers or industry will reduce their energy usage. That's what's broken about the push for renewable energy; it isn't a replacement of existing power production, it's on top of, and any added capacity is bought up and used.

Arnt 2y ago

Close. The office in Kansas City wouldn't use it, if that office existed. Suppose you can get solar power in Kansas City, but can't transport it to Seattle, maybe due to lacking interconnect capacity, maybe lack of contracts among the power companies, it doesn't matter. What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas and buy fossil power in Seattle. The Guardian thinks it's creative accounting, IMO it's a fair and good hack: When you open a new site and use that hack to buy power for the new site, the corresponding new power generation is solar. It's just solar with two additional accounting hops. There are other variants of the same hack.

danpalmer 2y ago
It's a useful stepping stone, and probably better for the environment than not doing it, but ultimately the emissions still happen. The sad reality is that in some areas there is no emissions free energy to buy no matter how much you want to. Some would say not to put datacenters there, but if there are customers wanting them I understand why companies do it (even if I don't agree).
- Arnt 2y ago
  Well… the emissions happen so long as someone else wants to buy fossil power, but you can hardly blame the DC company for some other company wanting to buy fossil power. In the case where I came across it, the problem was contractual. Only one vendor could supply power to that site. So by applying that hack, ① new renewable energy generation was built ② a conventional power plant lost a contract with Otherco and ③ another conventional plant gained a contract of the same size. After a while the contractual problem was solved. IMO it doens't make sense to choose site based on something as flimsy as a contract. Contracts are changeable on a timescale of months or years, buildings last longer.
- blueflow 2y ago
  If the emissions still happen, its not useful in doing anything for the climate.
  - Arnt 2y ago
    What are "the emissions" in your sentence? When a new server boots in such a DC, the increased power usage is matched by increased regenerative power generation, so what are "the emissions" that "still happen"?
    - blueflow 2y ago
      > and buy fossil power in Seattle.
      - dialup_sounds 2y ago
        This is offset by the amount of fossil power you replaced in Kansas by selling the clean power you purchased there. The net emissions are zero.
        blueflow 2y ago
        The "net emissions" are zero because "having 1 fossil plant running somewhere" is your baseline. You only move the location of that plant around.
spondylosaurus 2y ago
Ahhhh, that makes more sense! Thanks for explaining :)
jltsiren 2y ago
I think it's useful to look what happens at the margin. If you are connected to the grid, or could be reasonably connected, all the power you use comes from the source with the highest marginal costs in the region. Most of the time in most places, that means a power plant burning fossil fuels. If the demand goes down permanently, that power plant will be the first to shut down. If you buy existing clean energy to compensate for your emissions, overall emissions will remain the same, no matter which hacks or accounting tricks you use. That clean energy would be produced and sold anyway, because the marginal costs are so low. If you can't avoid emissions and want to compensate them, you must invest in new renewable capacity that replaces fossil fuels somewhere.
SiempreViernes 2y ago
If you buy so much solar that it leads to expansion of facilities, this "hack" will have you buying so much fossil power you are in effect subsidising the other fossil customers and thus prolonging their use of fossils. You definitely shouldn't count that power as 100% renewable. It only works as a clean bypass of you buy so little you don't impact the local fossil market, but this is a discussion about large data centres so that's basically never satisfied.
- Arnt 2y ago
  That argument applies to my personal electricity bill too. I buy my power from a company that supplies 100% regenerative power and gets most of its power from new generation facilities, 350 of them so far. Those 350 deliver power to about a half-million people, which obviously took market share away from existing fossil plants and pushed the market prices down. So by that test, what action does not prolong the use of fossil fuel? You're making the test much too strict.
- bryanlarsen 2y ago
  You've got that backwards. If you're using a solar credit from KC in Seattle, you're subsidizing the cost of power in KC. Solar generation is built in KC, but demand is unaffected. Therefore the price of power drops in KC, crowding out fossil there and lowering the price of green power. In Seattle you've increased demand without increasing generation, raising the price there. Yes, fossil generators may be built to satisfy this new demand, but that's unlikely in 2024. In Seattle in particular, excess demand is generally met by buying hydro from BC.
oarsinsync 2y ago
> Close. The office in Kansas City wouldn't use it, if that office existed. Suppose you can get solar power in Kansas City, but can't transport it to Seattle, maybe due to lacking interconnect capacity, maybe lack of contracts among the power companies, it doesn't matter. What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas and buy fossil power in Seattle. If I’m understanding this correctly: 1. You buy 1MW of solar power in location X, and don’t use it. 2. You sell 1MW of emissions producing power in location X, that someone else uses 3. You buy 1MW of emissions producing power in location Y, and use that. Net result: 2MW of emissions producing power used, 0MW of solar power used, and a claim of net-0MW of emissions produced? Yes, it’s a “clever hack”, but accounting sleight of hands are just that. Most charitably magic, less charitably outright falsehoods. > IMO it's a fair and good hack: When you open a new site and use that hack to buy power for the new site, the corresponding new power generation is solar. It's just solar with two additional accounting hops I don’t understand how you got to this outcome from the first position. Can you help me understand what steps I missed for this to actually have good outcomes resulting in solar power actually being used? I’d love to be wrong and for this to actually be actually good outcomes combined with clever accounting - those are absolutely the most satisfying solutions, both to design and read about (for me personally, anyway): where clever people are coming up with creative solutions to solve bureaucratic bullshit, while also achieving good outcomes. EDIT: Child comment has helped me spot the error in my comprehension leading to incorrect math: “ What you do is buy 1GW of solar in Kansas, sell that same power as fossil power in Kansas” - I didn’t read ‘same power’ properly in my first read. I’ve left my comment as-is despite it now being completely wrong as a result of that, and glad to have been wrong
- bastawhiz 2y ago
  > 0MW of solar power used No, the 1MW solar power was used. It was used by someone who believed that it created emissions. But the emissions were instead produced in Seattle rather than Kansas. The accounting relies on the person buying power in Kansas not to care that it's fossil fuel power that they're purchasing. They know that there's emissions from their power use, but they don't know where those emissions are.
  - 2y ago

pjc50 2y ago

Some people refer to these as "indulgences", like the certification of having your sins forgiven that the Catholic Church used to sell before Martin Luther (and half of western Europe) got mad about it. The effect is to either shift the attribution of emissions to some other company who doesn't care, or to cause renewables to be double-counted. Consider a toy grid, with two users A and B and generators C(lean) and D(irty). All connect to the same point. A buys a certificate saying that 100% of their energy comes from C. But that does not inform B about anything - they might reasonably look at the grid and then claim that 50% of their energy is clean, when in fact by arithmetic 100% of it is dirty because all the clean stuff has been bought by A. See e.g. https://industrydecarbonization.com/news/the-trouble-with-european-green-electricity-certificates.html https://industrydecarbonization.com/news/the-trouble-with-eu...

Ekaros 2y ago
Also I have always wondered about this model. Electricity is only fungible in the moment, not on longer scale. So let's say C goes entirely offline. How many of A instantly stop using any power? B can happily use the D as overall on long term it will balance out, but A should not be able to use any power.
- pjc50 2y ago
  Electricity is momentary, but REICs are not, so you can just buy some more from a different time period. It averages out, right?
maxerickson 2y ago
The toy grid example is cute, but in practice, billing does happen.

joshvm 2y ago

Having a grid makes it pretty difficult to "buy clean energy" because all generation is sort of laundered together. If you pay for a clean energy supplier, obviously there is no way to force that you only get electrons pushed by solar or whatever. You could change your supplier from week to week and nothing in the grid infra changes. But the market overall determines who can sell power, so if nobody wants to buy from coal, the coal plants won't get paid (or it becomes financially unviable to generate). If you have on-site generation then this is a bit different because you can at least reduce your grid consumption. But otherwise it's not hugely different to buying carbon offset credits and assuming the trees will exist in 100 years.

Cthulhu_ 2y ago

Sounds like carbon emission rights which are freely traded from companies that just get them without using them; iirc Tesla earned a lot of money selling their emission rights. I mean on paper it's a good idea, but there's not enough restrictions. Emission rights, for example, should be bought (from the government) in the first place, at an exponential price (so the more you need the more you pay). Supply should be reduced every year, with a goal being zero. They should not be tradeable across country (or in the case of the US, state) borders. Same with these renewable energy certificates mentioned, the further away the source, the higher the price should be. But that's all bookkeeping shenanigans; it doesn't mean that e.g. data centers or industry will reduce their energy usage. That's what's broken about the push for renewable energy; it isn't a replacement of existing power production, it's on top of, and any added capacity is bought up and used.