Data Center Dynamics: Everything data center operators need to know about Power Purchase Agreements (PPAs)
There are few buildings more energy intensive than data centers. As densities increase, single facilities can now eat up more energy than whole towns.
To offset this and ensure their green credentials, many companies are signing power purchase agreements (PPAs), which help bring new renewable energy projects online and help organizations claim their operations are sustainable.
Data center hyperscalers such as Meta, Amazon, Microsoft, and Google are some of the largest corporate buyers of renewable energy in the world, each having procured multiple gigawatts of renewable energy and investing in hundreds of renewable energy projects globally.
But what are PPAs, and what do data center operators need to know about them?
“In its simplest form, a power purchase agreement is a way for large energy consumers to meet their sustainability goals by receiving energy attribute certificates from renewable energy projects, and do it at scale, explains Joey Lange, managing director of the renewables team at energy consultancy firm Edison Energy.