Towercos own the energy equipment at over 2.6mn sites worldwide and so decisions made by towercos about how those sites are powered will have repercussions around the world for greening the network. Many towercos are already advanced in investment in renewables, storage and other innovative approaches to cutting their emissions. Reducing reliance on carbon-based fuels is being found to be more economical, more resilient and more pleasing to investors than business as usual. In this article, TowerXchange discusses how towercos account for their emissions, the carbon intensity of their towers, and the steps being taken to green the network.
Why care about emissions?
Some towercos operate like real estate companies, and in those cases, the towercos’ emissions are commensurately lower. American Tower Corporation (ATC) produces 99% of its emissions at its tower sites in the markets where it operates energy equipment. In its LATAM markets, its emissions are 63 times lower per tower than in its Indian business. That isn’t because the network is using less power, but because of the way the emissions are accounted for. Power is the MNO’s responsibility in LATAM, whereas ATC must account for its power generation and grid usage in India.
Towerco emissions come in two main flavours: diesel gensets and grid power. We can use American Tower as an example. The first set of emissions to consider are produced by generators running at its tower sites, these are controlled directly by American Tower and are recorded as Scope 1 emissions. Over 600,000 metric tonnes of CO2 equivalent (MTCO2) are produced each year by American Tower’s gensets. The main method deployed to reduce these emissions is to move generation away from diesel generators and towards hybrid systems, in which the generator is cycled with batteries to reduce total run-time. But solar, wind, fuel cells and alternative forms of generating power all help too.
Depending on grid quality, the bulk of ATC’s emissions are from grid electricity, which American Tower manages for its tenants in many markets, these are recorded as Scope 2 emissions, as they are caused indirectly by the grid from which American Tower draws power for its tenants. These emissions are harder to reduce, but more efficient sites, outdoorisation, passive cooling and smart energy management all help.
There are also indirect emissions embedded in the steel used by towercos, in the flights taken to negotiate M&A deals, water used in construction and petrol burned visiting sites. These Scope 3 emissions are hard to measure and control.
Figure 1: American Tower’s emissions
Reporting
Reporting on emissions varies hugely. Some towercos report headline figures for energy usage, carbon emissions and average usage per tower like American Tower. Some provide ad hoc reporting like Indus Towers. And others provide comprehensive reporting down to the carbon emissions embedded in the paper they use, like Cellnex. Reporting standards as slowly improving, as in most sectors, and TowerXchange would urge towercos to take this accounting and reporting seriously so that they are able to track their energy usage and emissions more accurately.
Figure 2: Selected towerco emissions
Intensity and energy efficiency
The net emissions of two towercos can differ considerable. Vertical Bridge has achieved a net zero score for its towers in the United States by reducing energy consumption and offsetting its unavoidable emissions. American Tower emits 3 MTCO2 per tower per year in the United States, 0.4 MTCO2 per tower per year in its LATAM business, and 25.1 MTCO2 per tower per year in its Indian business where it is responsible for generating and supplying power it to its tenants.
In Spain, Cellnex is responsible for proving power to the tower, which involves managing the grid connection for its tenants, whereas in France tenants manage their grid connections themselves. As can be seen this leads to a radically lower carbon intensity per tower in France than Spain. This accounting has real world consequences, it means in France that responsibility for greening the network must lay with MNOs, whereas in Spain Cellnex is able to lead the way. Towercos and MNOs must find ways to work together to reduce the energy consumption of the network.
In Asia, Indus Towers has annual emissions of 15.92MTCO2 per tenancy, with a tenancy ratio of >2.2 that means their towers are quite carbon intensive. However, reporting emissions per tenancy is probably a more accurate measure as it better reflects the benefit of tower sharing. Unfortunately tenancy information is less widely available than tower counts, and so we report tower carbon intensity in Figure 3.
This league table is not a table of the good, the bad and the ugly. Each towerco reporting its emissions should be commended even if towers appear much more polluting in one market than another. However, those with more carbon intensive towers may well be likely to spend more on renewables, experiment more with storage and work with MNOs on reducing the power draw of their network.
Figure 3: Emissions per tower
How many towercos will go carbon neutral?
In 2017, ATC set a goal of reducing its Scope 1 GHG gas emissions in Africa and India by more than 60%, 140mn litres of diesel annually by 2027. That would require big changes in its operations, significantly reducing fuel deliveries and investing in new energy equipment at sites to produce, store and use power more efficiently. Assuming a site uses 2,000 litres of diesel a month, with only two generators on site, that implies switching nearly 6,000 towers from the dirtiest forms of energy to the cleanest, or halving diesel runtime at 12,000 towers.
Indus Tower have been working since 2012 to create a Diesel Free Indus by 2021. They may not be able to meet this target but 67,500 sites are now diesel free with a 48% reduction in diesel consumption since 2012, including a 12% reduction in 2018/19. Like Indus, Bharti Airtel is aiming for a Zero Emission Network, although without a target year set. edotco also plan to achieve carbon zero, although they have set themselves a more long-lived target of net zero by 2050, in tune with the Paris Agreement.
Few other towercos have set targets as ambitious as the above, but many more may begin to follow now that MNOs are increasingly setting themselves Science Based Targets for renewables use and emissions reduction (see TowerXchange’s How MNOs plan to green the network). Working with tenants will be essential if networks are going to green. For example, Indus Tower has been working with tenants to reduce load on sites, which has enabled them to reduce diesel run times and allow sites to run on battery power.
How to talk about emissions
Each firm emits pollution in different ways. The standard way to discuss these emissions is to split them into direct emissions and indirect emissions, these are described as Scope 1, Scope 2 and Scope 3 emissions. But what are scope 1, scope 2 and scope 3 emissions? Scope 1 emissions describe direct emissions from owned or controlled sources. Scope 2 cover indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by a company. Scope 3 emissions cover all other indirect emissions that occur in a company’s value chain. For example, an MNO reports emissions from a leased tower as Scope 3 emissions. But the towerco generating power at the site would report those emissions as Scope 1. An MNO which owns its own off grid sites would report most of its emissions under Scope 2.
An easy way to visualise these is to think of them as receding circles of control. Scope 1 refers to the things you control. Scope 2 refers to the energy you buy, and scope 3 refers to the goods and services you buy.
What is a “green tower”?
Completely eliminating emissions from a telecom tower is all but impossible, with so many emissions embedded into the site through its supply chain. However, running the site can be rendered largely carbon free through the use of clean energy and clean maintenance, however at what point a tower become “green” is up for debate.
Bharti Airtel has a programme of seven initiatives to green its network; switching to solar for primary power, using fuel cells as back-up, reducing diesel consumption, maximising grid utilisation, using passive cooling, using battery-based cooling and bringing in efficient diesel consumption.
It would be counterproductive to only call zero-carbon sites “green” when so many other innovations are greening the network and TowerXchange takes the view that all moves towards efficiency and emissions reduction should be commended. Bharti has 2,500 sites which use solar as primary power, but on a broad definition 15,226 of their sites, or 39% of their March 2019 portfolio, can be considered green.
Solar and storage
ATC has a programme of mass replacement of lead-acid batteries with lithium-ion batteries and broader utilisation of solar power sources, a trend that most MNOs and towercos are following. In 2018, ATC invested over $30mn of capex in new energy solutions. The capex being justified by extending the lives of existing generators and reducing site fuel consumption – sometimes by up to 76% in the case of our lithium and solar hybrid sites.
By the end of 2018, the last year for which we have data, ATC had added lithium-ion batteries to 1,800 sites worldwide, primarily in Africa and Asia, with some in LATAM, generating some US$10mn opex savings annually. ATC also grew their number of solar assist sites to approximately 3,000 globally, with 13 megawatts (MW) of installed solar generation capacity, including approximately 10 MW of solar across 2,300 sites in India. Bharti Infratel has also backed renewables in India, with over 2,500 sites now powered by wind or solar. In Rural and semi-urban areas.
In Asia, edotco reports 1,708 solar power sites, plus 12 wind and 277 which hybridise solar, diesel, grid and wind for maximum flexibility. In Nigeria, in 2018 IHS Towers invested US$48mn in installing 877 new towers that are powered by their bespoke hybrid power systems including solar panels, generators and battery systems. That is on top of a further 494 solar panels elsewhere, according to their 2018 Sustainability Report. Over 50,000 individual batteries were deployed across IHS Towers’ estate to support their hybrid systems, saving 250,000 MTCO2.
Harit Sanchar: Central battery recharging
Indus Towers plans to reach zero diesel by 2021 through their Harit Sanchar (Green Communications) scheme, a first of its kind in the tower industry. Indus are creating a new charging ecosystem to reduce their diesel consumption. Diesel gensets are replaced with rechargeable battery cells which are then recharged offsite. Instead of transporting diesel to the site and burning it there to produce energy, batteries are cycled between the site and a central charging location. Indus claim this system results in lower GHG emissions, 24x7 availability, a lower cost of operations, big opex reduction for telcos and the removal of diesel transactions.
Fuel cells
Uptake remains limited to proof of concepts in most markets, with edotco boasting one hydrogen-based fuel cell site and just two methanol fuel cell sites. However, Jio backer Reliance Group are working on applying fuel cell to telecom sites, although the industrial giant is working on the technology internally for deployment on its Jio sites and others. Many other towercos have Proof of Concepts running.
Cooling cheaply
Natural cooling, free cooling and solar powered cooling can all reduce energy usage. In India, ATC redesigned its cooling systems in a manner similar to free and natural cooling units. Indus Towers are also reducing diesel consumption by replacing HVAC systems with energy efficient cooling solutions at 100,000 sites.
Scope 2: Green grids
Scope 2 emissions refer to emissions associated with purchased energy. In some markets where towercos are responsible for supplying energy it is possible to source cleaner energy from the grid and reduce the emissions. In Brazil ATC has worked with grid partners to source 254 MWh of renewably generated electricity. In Paraguay and Costa Rica the national electricity grids supply electricity generated almost completely by renewable sources, thus making grid-connected sites green sites. In 2018, approximately 19% of ATC’s purchased electricity was renewably generated.
Even where grids are not especially clean, connecting a diesel-powered site to the grid normally produces emissions reductions. edotco see a 41% reduction in emissions when they switch a diesel site to grid power, providing a significant environmental benefit to the operational and financial imperatives. This is also a driver of Helios Towers’ grid connection programme in Tanzania where contractual terms means that Helios Towers is incentivised to connect sites to the grid from a financial as well as operational point of view.
Scope 3: Steel
Scope 3 emissions are some of the hardest to change as they require working with your suppliers and effecting change where you have no direct control. Vertical Bridge are now engaging with their tower supply chain to reduce emissions. Emissions embedded in the steel they use to build towers are a significant source of their Scope 3 emissions and they want to work with their suppliers to support them in reducing the environmental impact of the steel they make. edotco has adopted three-legged towers to reduce the amount of steel they use, and have also used carbon fibre for nine towers and bamboo for a further 15, significantly reducing the embedded emissions.
Data collections and utilisation
87% of edotco’s sites are now fitted with their smart control system “ECHO” which enables them to manage power on site more efficiently, switching between power sources, and managing generator run time, an essential step to greening the network. Helios Towers put figures to the improvement in their 2019 annual report: their programme with Siterra enabled a 39% reduction in diesel generator run-time on the 519 sites that were optimised and a 16% increase in the solar output of 400 sites in DRC and Tanzania. Those improvements were enabled through improved generator efficiency and improved depth of discharge of their batteries.
The future
Towercos operate 2.6mn towers in power-as-a-service markets, 600k even if you exclude China Tower Company. These towercos have full control over the emissions of those sites and the energy used. We expect to see significant moves to invest in renewables and storage. In markets where towercos operate power there is also a growing awareness that green networks are more resilient networks. COVID-19 disruption to supply chains and lockdowns interrupting maintenance have caused towercos to reassess how they manage site availability. For example, American Tower credits its investments in solar and storage to improving the reliability and resilience of its infrastructure. The sizeable investment we have seen so far is likely to just be the tip of the iceberg.
Information in this piece was drawn from the latest annual reports or sustainability reports provided by each of the towercos discussed.
