Cloud Sustainability

Framework / Domains / Optimize Usage & Cost / Cloud Sustainability

Incorporating sustainability criteria and metrics into cloud optimization, to ensure environmental efficiency is balanced with financial value, and cloud optimization decisions are aligned with organizational goals.

Determine Cloud Sustainability policies and guidelines

Align cloud sustainability strategy with other optimization goals / commitments
Identify opportunities for cloud sustainability improvement
Engage with cloud and engineering stakeholders to evaluate sustainability effectively

Definition

Cloud Sustainability defines how the organization will make decisions about using cloud in ways that consider both its impact on the environment and the organization’s broader sustainability goals. Cloud Sustainability allows engineers and product personas to balance environmental considerations alongside financial costs or benefits of the cloud when architecting, optimizing, and deploying workloads in the cloud.

Many organizations have an organizational sustainability program that is looking more broadly at environmental impact than just cloud use. The amount of the environmental impact represented by cloud use will vary greatly by organization depending on all of its sources of carbon emissions. Regulation requiring more regular reporting of environmental impacts, including direct and indirect carbon emissions, is being enacted in many areas of the world. As a result, visibility of cloud usage in terms of carbon is becoming increasingly important for cost allocation, reporting, forecasting and other important IT functions.

FinOps teams should be integrating with organizational sustainability programs (via the Intersecting Disciplines Capability), incorporating sustainability information into the Understand Cloud Usage & Cost and Quantify Business Value Domains, and within this Capability should be working to identify opportunities for optimization of cloud cost and usage which support the organization’s sustainability goals. Similar to opportunities to optimize usage identified in the Workload Optimization Capability, or to optimize rates in the Rate Optimization Capability, work done in this Capability will generate potential opportunities to reduce the carbon footprint of cloud usage. Recommendations from each optimization domain can be evaluated by the FinOps team and other Personas to select the options over time that produce the best value to the organization, whether financial, environmental, or operational.

Generally speaking, Workload Optimization recommendations correlate closely with lower carbon emissions by only using what is needed, and only when it is needed (i.e. turn the lights off when not in use, use the correct size tool for the job). However, cloud sustainability efforts can run counter to cost savings in Rate Optimization efforts, where reserved discounts on certain resources might discourage optimizing them or turning them down. Some architectural or operational decisions may conflict with sustainability goals, for example the need for multiple copies of data or resources to support availability, or the use of nearby (but less energy efficient) locations for latency reasons. And some cloud services in certain locations may be less expensive, but more carbon intensive (or vice versa), leading to conflicts when deciding where to launch resources.

As with all topics in FinOps, collaboration among teams is crucial to determine the top priorities for the organization and allowing those priorities to determine how to balance tradeoffs. Cloud sustainability must be considered in the context of the needs of the business. The iron triangle balancing of cost, speed, and quality must include the cost of sustainability.

Cloud Sustainability is part of the Optimize Cloud Usage and Cost Domain, but cloud sustainability data will be used in many other Capabilities as well. For example, sustainability data may be brought in as part of Data Ingestion, allocated in the Allocation capability and will be included in Reporting & Data Analytics, will be used in Unit Economics metrics, or may be used when Benchmarking engineering teams based on their emissions cost.

Tip:
This capability references environmental impacts in terms of carbon (and equivalents), however this capability also should consider all measurable environmental impacts (including CO2e, Water usage, waste generation, etc) as data becomes available to the FinOps practitioner.

Sustainability considerations will include items such as the energy used to power and cool servers and data centers that make up the cloud, as well as the efficiency of workload architectures. In order to achieve outcomes related to Cloud Sustainability, organizations need to consider the embodied carbon which captures the full lifecycle of their cloud services, from the sourcing of materials and energy used to build the data centers, to the disposal of outdated equipment. Given the on-demand, dynamic nature of cloud use, it is relatively easier to optimize in comparison with the fixed hardware of a traditional data center. So Cloud Sustainability teams may be the first called upon to generate carbon reductions among other categories of IT spend.

Sustainability data available from each cloud provider or billing source will of course vary in its scope, granularity, and quality. FinOps teams will need to collaborate with Sustainability offices to determine the necessary granularity and how best to adjust or normalize data from the cloud providers to align with corporate mandates. Cloud Sustainability data quality concerns may continue for some time, and organizations should provide input to cloud providers or vendors about the data they require. However, the primary goal of this Capability is to use whatever data is available, even when it is incomplete, to make recommendations to the organization regarding cloud sustainability. Architectural, usage efficiency, and rate optimization decisions will continue to be made without this input if all efforts are centered on data quality rather than on using data to make directionally-correct, if imperfect, recommendations about sustainable use.

Maturity Assessment

Crawl

Key teams involved in cloud usage have a basic understanding of how cloud computing contributes to greenhouse gas emissions
Cloud teams understand how optimization in cloud can impact carbon usage
There may be a corporate mandate for reporting on carbon or carbon reduction, but the strategy to apply this mandate to cloud usage may not be mature
Teams have some carbon emissions data but likely poorly integrated with other data
Optimization activities are primarily centered on elasticity and turning off what is not being used
Tradeoff decisions where cost and carbon usage conflict are evaluated broadly and often on existing workloads
Enterprise functions (e.g. procurement, finance and business teams) have a basic understanding their involvement and basic understanding of how cloud impacts GHGE

Walk

All engineering teams and most other personas involved in cloud usage are aware of their potential impact on corporate sustainability goals
Cloud teams have a variety of mechanisms to reduce carbon use through optimization efforts
Ingestion and Reporting of carbon use data is shared with engineering and product, and is more granular but may not be fully integrated with cost data
Optimization activities move towards re-architecting or re-factoring existing workloads
Tradeoff decisions between carbon usage and cost are evaluated on a more granular level, and are sometimes considered ahead of cloud migration, build decisions

Run

The entire organization needs to be aware of IT’s impact on sustainability, and cloud’s role in that impact
Sustainability is considered in migration and optimization activities
Reporting is normalized across CSPs and is at a granular level, integrated with cost data to the extent possible, allocatable and reportable to individual teams for further analysis
Workloads are architected with sustainability in mind; teams use data to consider where to run workloads in advance of them being in cloud

Functional Activities

FinOps Practitioner

As someone in the FinOps team role, I will…

Collaborate with the Sustainability persona/Sustainability Team Members
Work with the Cloud Providers and other data providers to provide requirements to improve the granularity, quality, and auditability of their Scope 1, 2 and 3 emission data and factor that data into a usable, consumable format that is relevant for supporting sustainable business decisions
Ensure engineering and product teams have an understanding of how elastic and efficient resource provisioning within the business supports sustainability goals
Ensure that cloud sustainability optimizations are developed along with workload and rate optimization recommendations
Support the organizational sustainability goals by aligning cloud reporting and metrics to show positive/negative sustainability impacts in addition to financial cost impacts
Enable the business to make more sustainable cloud workload decisions by providing clear, relevant data that is correlated to other cost data and provided in near real time

Product

As someone in a Product role, I will…

Work with Leadership, Finance, and FinOps teams to understand the strategic business guidelines for sustainability that may impact product strategy
Work with Engineering to drive sustainability optimization where appropriate for products I work on

Finance

As someone in a Finance role, I will…

Work with Engineering teams to clarify, balance and justify guidance for more sustainable cloud options (lower carbon regions etc.) vs lower cost cloud options
To ensure accurate and transparent financial statement disclosures related to cloud use while maintaining integrity and adherence to sustainability regulatory standards

Procurement

As someone in a Procurement role, I will…

Work with FinOps teams to incorporate cloud sustainability reporting into corporate-wide sustainability reporting or data to inform strategic vendor decisions
Partner with Engineering to balance the needs of the business with sustainable architecture
Provide requirements to vendors for sustainability data or metrics needed to support cloud sustainability efforts

Engineering

As someone in an Engineering role, I will…

Work to understand the strategic sustainability guidelines and priorities for systems I work on
Be aware of the sustainability implications of my resource decisions in addition to other financial cost impacts, and work to deploy elastic solutions that minimize or eliminate wasted resources
Be aware of the sustainability impacts of various cloud services, in order to incorporate them into my builds or identify opportunities to optimize

Leadership

As someone in a Leadership role, I will…

Work with FinOps teams to understand how our cloud usage impacts our corporate sustainability strategy
Set strategy and priority for cloud sustainability optimizations or decisions with respect to other business drivers
Set and review OKRs/KPIs on cloud sustainability performance over time
Fostering sustainability culture and elevate support for prioritizing activities for cloud sustainability

Allied Personas

As someone in an Allied Persona role, I will…

Sustainability Team Members will work with FinOps teams to coordinate on how cloud usage impacts our corporate sustainability strategy
Coordinate on cloud sustainability performance over time

Measures of Success & KPIs

Sustainability reports available for all cloud providers; data normalized across all cloud providers; data aligns to scope/granularity needed for reporting compliance
Sustainability reports visible to all teams impacted and shown alongside cost data
Sustainability targets (e.g. carbon budgets) communicated to all teams; all teams can track their progress against targets
Impact on sustainability is considered during migration and optimization activities
Clear guidelines for taking action when comparing all types of optimization options, and specifically when sustainability goals conflict with financial goals

Key terms that are likely to be used in sustainability reports:

Term	Full Wording
Metric tons of carbon dioxide equivalents (mtCO2e)	Each measurement of greenhouse gas can be converted to metric tons of carbon dioxide equivalents by using that greenhouse gas’s global warming potential (GWP) factor.
kg of carbon dioxide equivalents (kgCO2e)	Each measurement of greenhouse gas can be converted to kilograms (kg) of carbon dioxide equivalents by using that greenhouse gas’s global warming potential (GWP) factor.
Liters of H2O consumed	Measurement for water consumption (commonly used in data centers)
MWh of electricity	Total megawatt hours (MWh) used from electricity
kWh of electricity	Total kilowatt hours (kWh) used from electricity
m3 of water	Typically, total water consumed in cubic meters
ESG	Environmental, Sustainability & Governance – sometimes an umbrella term for where Sustainability efforts are run in organizations.
CO2e	Carbon Dioxide Equivalent, or Carbon Equivalent, sometimes used as a unified way of expressing the environmental impact of an activity taking into account all of the various emissions or resource uses and expressing them in an equivalent of carbon dioxide for easier reporting with a unified measurement
SDG	Sustainable Development Goals, a set of evolving sustainability goals established and reported upon by various UN and governmental organizations
GHG	Greenhouse Gasses, all of the various gasses which affect the environment as emissions, including carbon dioxide, methane, and other pollutants

Inputs & Outputs

Work with Data Ingestion to obtain cloud provider and other vendor sustainability reporting and carbon data
Cloud Provider and vendor sustainability contextual information and optimization recommendations (e.g. comparisons of the carbon impact of various types of compute resources or locations) used for decision making
Third party data and recommendations for carbon reduction opportunities
Reporting & Analytics to ensure available sustainability data included in cost reports
Unit Economics to ensure sustainability data included in key metrics
Training, guidance to describe how to manage, view sustainability data (by team, application, etc)
Intersecting Disciplines where broader organizational sustainability groups exist and require specific reporting, data, or coordination

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Framework

Cloud Sustainability

Definition