Industry Report: Telcos, not datacentres, dominate energy consumption

According to MTN Consulting, even though people are paying more attention to how much energy data centres use, telco networks actually use more power globally. The study examined 57 network operators' sustainability reports to determine their power consumption.

The sample group was made up of 21 telcos, 16 webscalers, and 20 carrier-neutral operators (CNNOs) like tower companies. In total, they accounted for 94% of webscalers’ revenues and 60% of the global telco and CNNO segments’ revenue.

“Datacentres rightfully get a lot of attention for their power requirements. However, despite the last few years of heavy datacentre investments in both the webscale and carrier-neutral markets, these two segments accounted for just 22.9% and 11.1% of total network operator electricity consumption in 2021,” MTN said. “Telcos are dominant, accounting for 66% of the three-segment total in 2021, down slightly from 69.2% in 2020.”

In total, energy consumption by the three categories of operators was 467.6 Terawatt-hours, including both purchased and self-generated electricity. The 2021 figure showed an increase of 9.8% from the previous year, compared to only a 9.3% growth in 2020.

The webscalers are currently driving much of the growth and their power usage has surged by 25% in 2021, which is above the 19% from 2020. In contrast, CNNO's power usage increased by 15% in 2021 and 16% in 2020 while telco power consumption rose more slowly at 4.7% and then 6%.

MTN released a report showing that, while telcos still use the most electricity overall, data centre operators use far more when measured by power intensity (Megawatt-hour per unit of revenue). “In 2021, for instance, Digital Realty consumed 2,094 MWh of power per US$1 million of revenue, versus 97.6 for American Tower, 82.9 for AT&T and 71.0 for Alphabet, a large tower CNNO, telco and webscaler, respectively.”

In terms of their environmental impact, telcos were highlighted as being slow to adapt. Many telcos still rely heavily on fossil fuels for their electricity consumption. For instance, KDDI's renewable energy sources only made up 10.4% of its total power use in 2021.

Furthermore, telcos use large quantities of energy from non-electric sources (diesel, propane, heating oil, etc.) to fuel their buildings—particularly mobile base stations. Africa’s MTN Group relied on diesel for approximately half of its energy consumption in 2021.

“For telcos to really begin reducing their carbon footprint, big improvements in both energy efficiency and fuel mix will be required in their mobile access networks,” said MTN.