Initial reports indicate that a new Amazon data center in Singapore has been built using state-of-the-art green technology to achieve high levels of efficiency in reducing energy consumption and minimizing environmental impact.
But many are asking if this can be done at scale and if Indonesia can do it better.
Amazon Data Center Singapore
A recent study by Greenpeace has shown that Singapore still needs to improve its green data center facility. The report found that Singapore only has one Green Tier Data Center (and the rest are Blue Tier or No Tier), and only 3.8% of Singaporean electricity is from renewable energy sources.
One solution is to build their data center in a renewable energy source country such as Indonesia. If Amazon could develop its data center there, it would be possible for them to use 100% renewable energy sources, which would help them improve its services’ sustainability.
However, Amazon will have to think carefully about this plan because opening a data center in Indonesia would affect the local industry’s interests and business activities. It would also mean they must deal with local regulations and policies.
Fortunately, the Indonesian government has now made policies and regulations that make investing in green data centers easier. Amazon’s data center has started operating in Indonesia, although the level of carbon emissions is not yet clear.
Amazon’s Leadership and Design Approach
Amazon’s leadership team has built an amazing company by consistently innovating around the customer experience. Amazon employs a unique data-driven approach to innovation that contrasts with most other companies.
The leadership team focuses on customer feedback at every step of the innovation process. From new product development to improving customer service, Amazon relies on customer data as the core driver of its decision-making.
Amazon’s green data center approach centers on optimizing the building infrastructure to minimize the energy footprint for power and cooling.
The first step in their process is identifying the most energy-efficient equipment to meet their needs.
For example, Amazon built its data centers with a modular design, saving space and money.
The modular design also allows for more efficient power distribution since it only requires one power source for server racks rather than individual ones for each server.
Amazon’s data centers are also engineered to be as energy-efficient as possible on the inside by using free air cooling instead of air conditioning. The buildings are designed with air flows that can naturally stabilize the temperature through them and out of roof vents.e
This technique is not only cost-effective, but it is also more sustainable than traditional data center designs. HVAC units pull warm air out of the building and cause the hot air to circulate back into the room, creating a constant loop that wastes energy and reduces cooling efficiency.
Amazon’s system eliminates this waste by pulling in cool outside air and then releasing it without warming it up again. On top of these innovations, Amazon has also developed an internal green team that focuses on minimizing environmental impact throughout its operations.
Green Data Centers, Challenges, and Solutions
While reducing the environmental impact of data centers is a global trend, Asia also has some unique challenges.
For example, data center administrators must deal with higher temperatures and humidity than in other regions. Another challenge that only applies to Asia is the requirement to use 100% renewable energy.
In Singapore, any new commercial buildings must be certified carbon-neutral by 2021, and they must source at least 35% of their energy from renewables by 2030.
The city-state and neighboring countries also have abundant local talent in the green energy industry, so local partners are essential to success here.
New green technologies can also present challenges with high initial costs and complex implementation procedures. Complying with all necessary regulations is also challenging because different countries have different rules.
For example, if the Amazon data center in Singapore expands into Indonesia, it might not have to add extra water treatment systems since Jakarta’s water is cleaner than Singapore’s.
Singapore’s Main Competitive Disadvantage
Singapore does not have fossil energy sources like its neighboring countries. This makes electricity costs in Singapore more expensive than in other countries in Southeast Asia.
Data center facilities that need cooling are said to be one of the highest electricity costs in the data center. According to iDA Singapore, data center cooling costs are the main competitive disadvantage for data centers in Singapore.
Several approaches have been taken, such as stopping the temporary data center construction permit (Read: Singaporean Data Center Moratorium). After the data center moratorium was lifted in July 2022, strict requirements for efficiency and sustainability were implemented.
However, this will not change much in efficiency because Singapore’s location does not have energy sources. Currently, the Singapore government continues to develop renewable energy sources. However, the development of renewable energy fields takes a long time.
As an alternative, data centers in Indonesia are starting to offer Green Data Centers by implementing ESG. Starting from planning, site selection, design, and the entire infrastructure has been considered reducing carbon emissions.
All data centers must reduce their carbon footprint by 50% by 2025 and 100% by 2050, as stated in the Net-Zero Pact.
Amazon’s expansion suggests that it is optimistic, to a certain extent, about the continued growth of online consumer markets in Southeast Asia. And, since Indonesia has been termed as one of Asia’s Four Emerging Tiger Economies (along with Malaysia, Thailand, and the Philippines), any company eyeing Asia should take notice.
Amazon’s data center in Singapore will be challenging to expand. This has become a factor for Amazon to expand its data center in Jakarta, Indonesia.
Besides Indonesia being close to Singapore, it also has a robust infrastructure. The Indonesian government’s support for the data center industry has also attracted the attention of venture capitalists such as Goldman Sachs, Saratoga, and others.
It’s clear that Amazon is an indomitable force in providing e-commerce solutions to consumers worldwide. That said, it will be interesting to see how Amazon regulates the price of its services in the coming years. It may be willing to pass on lower profits to retain market share in some countries. From there, who knows what the future will hold? Only time will tell ;).