BEIJING – Alibaba Group and Tencent took the top spots in Greenpeace East Asia’s latest renewable energy scorecard for China’s tech industry, beating out Baidu by a wide margin. The report, Clean Cloud 2024, finds a significant gap in climate action by major Chinese tech companies, with some having made only limited progress toward achieving their own renewable energy goals.
Greenpeace East Asia climate and energy campaigner Xin Lyu said:
“AI is driving a surge in tech sector emissions, and pressure is growing for leading tech companies to reduce their climate impact. China’s tech giants appear to be taking note, and over the past two years, some top companies have reported significant breakthroughs in their renewable energy consumption. However, advancements have been uneven across the industry, and companies such as Baidu have made less progress toward meeting their own climate goals compared to their peers.”
The report analyzes ten of China’s leading cloud service companies and 15 leading data center operators.
Key Findings:
–Over the past two years, renewable energy procurement by top Chinese tech companies has increased significantly. As of June 2024, five of the ranked companies had reported annual renewable energy ratios that exceeded 10%, compared to just one company at the time of Greenpeace’s June 2022 ranking.
– Alibaba Group took the top spot in the ranking for the first time in four years. As of November 2023, Alibaba Group had purchased 1.61 billion kWh of renewable energy since the start of the year. [1] This was the highest volume reported by any company in the cloud provider category.
– Baidu continues to lag behind its peers on renewable energy procurement. In 2023, Baidu reported a renewable energy of approximately 5%. [2] This was significantly less than that of Alibaba Group (15.4% in FY2023) and Tencent (12.4%). [3][4]
– GDS received the highest score in the ranking of data center operators. In 2023, GDS reported a renewable energy ratio of more than 38%. [5] By comparison, GDS’ competitor, VNET Group, which operates data centers for Microsoft 365, reported a renewable energy ratio of approximately 4% in 2023. [6][7]
– Eight out of 25 companies in the ranking have committed to achieve 100% renewable energy by 2030. Of the companies that have targeted 100% renewable energy by 2030, ByteDance, the owner of TikTok, is the only one that has not disclosed data about its carbon emissions or energy usage.
Greenpeace urges that all tech companies target 100% renewable energy and carbon neutrality across Scopes 1, 2 and 3 by 2030. To maximize their real-world climate impact, companies should achieve carbon neutrality primarily through direct emissions reductions, including purchasing renewable energy and improving energy efficiency, rather than relying on carbon offsets.
“The trend toward decarbonization of China’s tech industry is unstoppable, but some companies are lagging behind. In particular, Baidu must ramp up renewable energy consumption to meet its own climate goals. Likewise, ByteDance, the owner of TikTok, needs to disclose its environmental data as a first step toward achieving its climate commitments,” Lyu said.
Notes
An English-language version of the report is available here (abridged). The full Chinese-language version of the report is available here.
The selected cloud service companies collectively comprised more than 52% of China’s Infrastructure as a service (IaaS) public cloud market share in the first half of 2023, while the selected data center operators held more than 60% of the internet data center (IDC) market share in 2022. [8,9]
Researchers used publicly available information to rate the companies in the categories of transparency, carbon reduction measures and targets, renewable energy procurement and targets, and government and industry influence.
A detailed guide to the methodology is available here.
[1] Bloomberg NEF (2023). ‘2023 China Corporate Green Power Trading Rankings’ Published online November 10, 2023. Accessed on June 29, 2024 from: https://mp.weixin.qq.com/s/e-jJaqOOmDJufu6ejeWZnw
[2] Baidu (2024). ‘Baidu 2023 Environmental, Social and Governance Report’ Published online May 13, 2024. Accessed on June 29, 2024 from: https://esg.baidu.com/Uploads/File/2024/05/17/Baidu%202023%20Environmental,%20Social%20and%20Governance%20Report.20240517150706.pdf
Note: Renewable energy usage rate = Renewable energy consumption disclosed by the company / Electricity consumption disclosed by the company
[3] Alibaba Group (2023). ‘Environmental, Social and Governance Report 2023’ Published online July 24, 2023. Accessed on June 29, 2024 from: https://data.alibabagroup.com/ecms-files/1509739361/fcaefa3d-0989-48fb-b003-fa96aa04880e/2023%20Alibaba%20ESG%20Report-Final.pdf
During Alibaba Group FY2023 (04/01/2022 – 03/31/2023), its renewable energy usage rate was 15.43%, calculated by Greenpeace.
[4] Tencent (2024). ‘Environmental, Social and Governance Report 2023‘ Published online April 8, 2024. Accessed on June 29, 2024 from: https://static.www.tencent.com/uploads/2024/05/29/045cba29b4153119f3cd17c406ac2433.pdf
[5] GDS (2024). ‘GDS Annual report 2023’ Published online April 29, 2024. Accessed on June 29, 2024 from: https://investors.gds-services.com/static-files/dbf98788-e2e7-4e36-8e4d-571c3eafc32f
[6] Microsoft 365 (2024). ‘Microsoft 365 operated by 21Vianet’ Published online February 27, 2024. Accessed on June 29, 2024 from: https://learn.microsoft.com/en-us/office365/servicedescriptions/office-365-platform-service-description/microsoft-365-operated-by-21vianet
[7] VNET Group (2024). ‘2023 Environmental, Social and Governance (ESG) Report’ Published online April 26,2024. Accessed on June 29, 2024 from: https://www.vnet.com/upload/portal/PDF/2023esgreport.pdf
Note: Renewable energy usage rate = Renewable energy consumption disclosed by the company / Electricity consumption disclosed by the company
[8] IDC (2023). ‘Post-Pandemic Growth Below Expectations: Growth in China’s Public Cloud Service Market Continues to Slow in the First Half of 2023’ Published online November 2, 2023. Accessed on June 29, 2024 from: https://www.idc.com/getdoc.jsp?containerId=prCHC51354423 Note: The combined market share of Alibaba Group, Huawei, and Tencent exceeds 52%.
[9] IDC (2023). ‘In 2022, China’s data center service market is still in a phase of slow recovery’ Published online August 14, 2023. Accessed on June 29, 2024 from: https://www.idc.com/getdoc.jsp?containerId=prCHC51148523 Note: The combined market share of China Mobile, China Telecom, and China Unicom exceeds 60%.