Adoption of cloud computing services enables a company to keep its green commitment in a big way

DQI Bureau
New Update

What does adopting the green mantra essentially entail? The reply from businesses would be: investing in energy-efficient equipment, reducing use of paper, etc. But there is one option of moving to the cloud that has remained hidden, but not for long.


Currently, most consumers consciously or not are already hugely dependent on cloud-enabled services like e-mail, social media, online gaming, mobile applications, etc. Businesses are now looking at cloud computing as a viable option to reduce costs and to improve IT and business agility.

If cloud computing is important, sustainability continues to gain importance as a performance indicator for organizations and their IT departments. There is more to cloud adoption than just the regular savings. It also helps to turn a green leaf, says Pallavi Khaturia, director of server business, Microsoft India.


A Microsoft, Accenture and WSP Environment & Energy Study highlights the fact that businesses that choose to run their applications on the cloud can help reduce energy consumption and carbon emissions by a net 30% or more, compared to a scenario where they opt to run those same applications on their own infrastructure. Large data centers, like those run by Microsoft, benefit from economies of scale and operational efficiencies beyond what corporate IT departments can achieve. Benefits become even more significant for a small business moving to the cloud, where the net energy and carbon savings can be more than 90%.

We are a company working in the online marketing space and we adopted cloud computing services in 2007. Our decision was driven by the fact that hosting in-house servers would add more pressure to the company. And when we did get good options without migration issues, without having to worry about the drives, infrastructure, etc, outsourcing came forth as a good option. Apart from these reasons, there is the offering of scalability which is very important for a small and growing company like ours. When you avail cloud services the benefit is that you can grow as and when you need to. Cloud services are all about being green and scalable, says Vyom Khandelia, director, IT, Position2.

Beyond the commonly cited benefits of cloud computing, such as cost savings and increased agility, it also has the potential to significantly reduce energy consumption and carbon footprint associated with running business applications. By moving applications to cloud services, IT organizations can take advantage of highly efficient cloud infrastructure, and also effectively outsource their IT efficiency investments and enable their companies achieve their sustainability goals.


We have moved to the cloud and have noticed the benefits since the last three and a half years. When you move to the cloud, the capex goes down and the opex increases. says Khandelia.

Finer Aspects


The report further highlighted the fact that lower energy use and carbon emissions enabled by the cloud was due to certain reasons, namely

  • Dynamic Provisioning: Large operations enable better matching of server capacity to demand on an ongoing basis.
  • Multi-tenancy: Large public cloud environments are able to serve millions of users at thousands of companies simultaneously on one massive shared infrastructure.
  • Server Utilization: Cloud providers can drive efficiencies by increasing the portion of a servers capacity that an application actively uses, thereby performing higher workloads with a smaller infrastructure footprint.
  • Data Center Efficiency: Through innovation and continuous improvement, cloud providers are leading the way in designing, building and operating data centers that minimize energy use for a given amount of computing power.

Improved utilization means cloud providers are at 40% to 70% resource utilization, rather than an on-premise average utilization rate of 5% to 10%. Meanwhile data center efficiency translates to more data center power, going to the hardware rather than elsewhere.


Although many organizations may be able to address some of these factors in their own data centers to decrease energy use and emissions, due to economies of scale, providers of large, public cloud infrastructure are best positioned to help reduce the environmental impact of IT through efficiency and scale. Cloud service providers are making significant investments in data center infrastructure to provide not only raw computing power but also SaaS business applications for their customers. New data centers are being built at large scales and with increased server density, resulting in greater energy consumption.

For us, innovation is used to get closer to our customers and better our offerings. Innovations at the data center is not going to remain behind either. Take the case of our data center at Chicago that stands tall at more than 700,000 square feet, which is being remotely managed by 12 people. This consumes 10% of power and 1% of water, leading to a green effect, says Khaturia.


The Smart 2020 report Enabling the Low Carbon Economy In the Information Age estimates that the environmental footprint from data centers will more than triple between 2002 and 2020, making them the fastest-growing contributor to the ICT sectors carbon footprint. It stands to reason that consolidating corporate IT environments into large-scale shared infrastructure operated by specialized cloud providers would reduce the overall environmental impact and unlock new efficiencies.

While the study focused on Microsoft products, the same concept can extend to other cloud providers as well. The analysis suggests that on an average across the different applications, typical carbon emission reductions by deployment size are:

  • More than 90% for small deployments of about 100 users.
  • 60% to 90% for medium-sized deployments of about 1,000 users.
  • 30% to 60% for large deployments of about 10,000 users.

The per-user energy use and carbon footprint is heavily dependent on the size of the deployment. The cloud advantage is particularly compelling for small deployments because a dedicated infrastructure for small user counts, as in a small business running its own servers, typically operates at a very low utilization level and may be idle for a large part of the day. However, even large companies serving thousands of users can derive efficiencies from the cloud beyond those typically found in on-premise IT operations.

Cost Effect

The combination of large-scale operations, demand pooling and multi-tenancy create enormous economies in public cloud data centers. A 100,000-server data center has an 80% lower total cost of ownership (TCO) compared to a 1,000-server datacenter. With adoption of cloud services there is a 40-fold cost reduction for SMBs. For organizations with a very small installed base of servers (<100), private clouds are prohibitively expensive compared to public cloud. Meanwhile there is a 10-fold cost reduction noticed by larger enterprises. For large agencies with an installed base of approximately 1,000 servers, private clouds are feasible but come with a significant cost premium of about 10 times the cost of a public cloud for the same unit of service.

On a final note, Kathuria says, Movement to the cloud may be made for business reasons but it is a great environmental move too that offers the company the option to trade in carbon credits. Apart from that it enables a company to comply to regulations. Companies doing business with Western countries are required to submit carbon emission reports and this requirement is expected to increase. And this one step in inching towards industry demands.

Shilpa Shanbhag