The Six Five On the Road at AWS reInvent 2022. Patrick Moorhead and Daniel Newman sit down with Christopher Wellise, Director AWS Sustainability at AWS re:Invent2022. Their discussion covers:
- The announcements AWS made regarding sustainability
- What it means to be Water Positive for AWS customers
- Why the cloud is a more sustainable option than other solutions
- A recap of other sustainability announcements from 2022
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Transcript:
Patrick Moorhead: Hi, this is Pat Moorhead and we are here live at AWS Reinvent 2022 in Las Vegas. This has been an incredible event. I mean, we’re seeing the maturity of the cloud. It’s 15, it’s a teenager, kind of awkward, not perfect, but growing a ton here. But I got to tell you this, is this a great event?
Daniel Newman: That 15-year thing and that awkward teenager metaphor, I mean, it’s going to stick with you. It’s going to be with you for the rest of your career.
Patrick Moorhead: It is, and I’ve only used it for the opening for half our videos, so not all of them. But no, you have to admit though, I mean putting these things in perspective, I think is important because it gives you that idea kind of where it is. And I think we all know that. I think even Andy Jassy said on CNBC, we’re 10% into the cloud journey, so we’re definitely not there. I mean, 15 is pretty good, right? That’s like well, 25% of your life.
Daniel Newman: It’s still early days, but there’s no question just walking around the show floor or the hall that the demand for compute, the demand for the cloud, and what you can do with the data, with the apps. And then of course, with all the infrastructure, it’s only growing. And any speculation of the world, the technology is in some downward cycle misleading. I mean, the truth is there’s not a single part of the technology stack that you can look out five years and say it’s going to be less important. So yeah, we hit bumps, we hit cycles, we hit ups, we hit downs. Straightforward, walk through the halls here. You’ll see every enterprise, governments, academic institutions, organizations, non-for-profits, they’re all here looking at ways that technology can drive their businesses into the future. And of course, they’re all here looking at ways to do that in a sustainable fashion that helps not only their companies be more successful, but helps the planet too.
Patrick Moorhead: Yeah, it’s a great lead in to introduce our guest. Chris, how are you doing?
Christopher Wellise: I’m doing great. Thanks guys. Thanks for having me.
Patrick Moorhead: Yeah, good to see it. Really fun green room conversations. Sometimes I’m thinking we should just turn on the camera during those and maybe kind of a blooper around.
Daniel Newman: Bloopers, B-roll. Maybe some of the actually best and most intimate interactions that we have on the show.
Patrick Moorhead: Oh, I agree. So Chris, maybe a good place to start is let’s talk about what you do for AWS?
Christopher Wellise: Absolutely. So I’m the director of sustainability at AWS. And I really, to simplify it, I focus on driving down the environmental impacts of our infrastructure as well as helping customers to meet their own sustainability related needs.
Daniel Newman: So that shirt was made out of recycled goods, right?
Christopher Wellise: That’s right. Bamboo.
Daniel Newman: I love it. I love it.
Patrick Moorhead: But is it edible?
Daniel Newman: We’re working towards those kind of things. You guys had some big announcements that happened here. One of the biggest ones. And Adam’s keynote was largely focused, had an underpinning and theme of sustainability all the way through it. But talk about the water announcement. You guys made a big announcement, something that you were very excited and it came out very early in his keynote, which is always an indicator that this is front center and in focus. Sustainability is really important to AWS.
Christopher Wellise: Absolutely. Well, first of all, it’s great because Adam not only understands what we’re trying to accomplish from a sustainably perspective, he’s got a personal passion for it, which is great. And he knows what it means to our customers. So that’s always helpful when you’ve got leaders that really get it, understand the deep complexity around some of these topics. Our big announcement was around being water positive. Most people when they think about cloud services and applications that they’re running, water’s not diversity that comes to mind. But we do use water. There are a lot of resources that go into powering the cloud, like any resource intensive or energy intensive infrastructure or operation.
Water’s used primarily in cooling processes through evaporation. We do employ technologies to limit the need for water. So things like IoT analytics and sensors that only allow or require water when absolutely necessary. But in taking that into consideration, what the team did is we thought, we understand that water’s a scarce resource. Half the world’s population is going to be within water stress regions by the end of 2025. It’s predicted, primarily driven through climate change. And we understand that it’s an important resource. And so we wanted to essentially really focus on our water stewardship. So what water positive means is we will give back more to the communities and watersheds that we operate than we require for our direct or use for our direct operations. That’s what water positive means.
Patrick Moorhead: No, that’s great. And I’m sure you look out into the future, and it’s going to be even more challenging for a lot of reasons. So first of all, Moore’s law has slowed down. And essentially what that means is you have to do more work with more power. And with more power comes more heat. And with more heat, you need more water to cool that off. In fact, a lot of supercomputers today and even high performance computing use water to cool things down. By the way, as a byproduct, a research lab in Canada is using that excess heat to melt ice and snow on its roads, which is pretty novel.
But the challenge is going to get even harder in the future. And one of the things that I’ve appreciated is you have even homegrown processors with the graviton line that use 40% less power than other instances. So it’s not that you’re putting your money where your mouth is, making some pretty big investments to be able to do that as opposed to maybe just buying something that’s different. Is this a water initiative? Is this a new thing? How long have you been working on it?
Christopher Wellise: We’ve been working on it like we do many things before we announce large targets, as we work on them internally. We’ve had an internal goal around water positivity, establishing and fine tuning the metrics associated with being water positive. And we’re really focused on accomplishing water positive through four key strategies. You brought up an important one. AWS now designs and develops our own silicon around the third generation of graviton. That’s an important element. So efficiency is the first strategy to limiting water use in our operations. And I mentioned we deploy things like IoT analytics and sensors in the data center environment. In countries like Sweden, and Ireland, for instance, 95% of the time we don’t use any water, because we’re able to monitor the ambient temperatures. We use free air cooling when possible. And only when we exceed those certain flip points do we actually begin to use water. So really focused on efficiency. Doing more with the less is really critical.
The second way or second strategy that we employ is around recycled water. So we actually invest in some of the communities where we operate. Loudoun County, Virginia, as an example, Northern Virginia. We have worked with the local municipality to develop infrastructure to reuse waste water. So you don’t need drinking water quality.
Patrick Moorhead: Is it called brown water?
Christopher Wellise: We call it purple. The pipes are purple. But there’s gray water.
Patrick Moorhead: Gray. That’s what I meant to say.
Christopher Wellise: Yeah. There’s gray water. It’s one level up from the brown water. But again, I mean through engineering controls, treatment and processes, you can actually get to a point where it can be readily used for things like cooling, and therefore you’re actually recycling and reusing water in a way where you’re limiting the need for extracting or consuming that high level potable resource. The third strategy is through reuse. When we run the water through our evaporative cooling systems, we can do it several times and then it needs to be treated. You’re essentially concentrating the dissolved solids through evaporation. You’re not polluting it per se, but you’re concentrating the dissolve solids that need to be removed.
But after removal, that water can still be used for things like irrigation. And that’s exactly what we do in places like Umatilla Oregon, in eastern Oregon where they’ve got a drought issue. Farmers use our waste water from our cooling operation to irrigate crops. And then our fourth strategy is really around rehabilitation projects, rehabilitating watersheds, replenishing groundwater tables where we can through groundwater recharge projects, making water available to communities where we operate, which includes things like sanitation, hygiene and so on. So through those four strategies, we’re working to achieve our water positive goal by 2030.
Daniel Newman: Cool. Very ambitious. And of course, being the largest infrastructure provider in the world, you’re using a lot of compute. To Pat’s point, you’re doing things innovating on the tech side, but you’re also innovating on the sustainability side. I do have a bigger question. So both Patrick and I follow very closely, the broader Amazon. It’s been one of the most outspoken global leaders in terms of talking about sustainability, the climate pledge, some of the things the company has done with Rivian in the electric vehicles, in the electric delivery. I’m just curious, do you work closely? Is there a lot of coordination that exists between AWS and Amazon? I know some of the parts of the companies are like this and other parts are like this.
Christopher Wellise: Absolutely. We work very closely. As a matter of fact, I was meeting with customers with Kara Hurst, our global VP of sustainability this morning. They’re AWS customers, but they often move beyond, depending on their business model, they might want to understand what we’re doing around logistics, what we’re doing in our fulfillment centers, how we’re working to procure additional renewable energy. There are a number of different ways where we might engage across the company. So we really work very closely in tandem and have a one Amazon approach to sustainability. I
Daniel Newman: Think that’s great. And thanks for answering that. I’m curious because like I said, I know you often feel like we’re this group and we’re this group, but the world does see Amazon as Amazon.
Christopher Wellise: Absolutely.
Daniel Newman: And so I think the more that narrative stretches across the company, and you kind of tell this very consistent story, a lot of value in that. So let’s stay on the AWS front though. I’ve run off the road. I’ll go back on. What other announcements were important for you on the sustainability side at this event?
Christopher Wellise: Well, we’ve had several over the course of the year. The big one at Reinvent in 2022 in Vegas was our water positive announcement. But we’ve rolled out a number of things this year. We rolled out last March, the customer carbon footprint tool, which was really critical to helping our customers understand from the analytics perspective what the carbon related to their deployment of workloads on AWS cloud looks like. They want it not only for reporting purposes, but they want to figure out how they can change behaviors to optimize for sustainability. So that’s one of the things that we’ve been really working on closely, and we’re hoping to roll up more features in that tool in the future.
Patrick Moorhead: That’s great stuff. I love the new pieces of data that customers can use to help make better choices. And sometimes if the ability for somebody to pick something that it helps them meet their sustainability goals and it’s good enough performance and the cost is right and they can go for it, I think choice is good. So there are many debates out there on on-prem versus the cloud. I mean, I’ve been running my business for 11 years and I think I’ve had 11 years full of debate on which model’s better? Well, I think, or it’s this mature, right? We talked about this 15 years where it’s like, okay, the future’s going to be a combination of OnPrem and public cloud, A lot of AWS public cloud. Of course. Congratulations. Why is the public cloud so much? I heard a statement that y’all made, said the public cloud is more sustainable, that OnPrem. Can you take us through that?
Christopher Wellise: Well, sure. Well, I mean, first your point around just technologists now focused on sustainability is an interesting one. And I’d like to riff on that for a second. Because one of the things that’s so interesting to me, having worked in this space for a number of years, the number of CTOs and CIOs that have become sustainability experts. I think it’s just awesome. A number of the discussions at Reinvent this year have been CTO CIOs that are directly engaged in sustainably related goals associated with their IT estate. That’s pretty exciting. You wouldn’t have seen that even three, four years ago.
Patrick Moorhead: I agree.
Christopher Wellise: It might have been one or two that had a personal passion for it and we’re self taught, but now we’re seeing more and more of it. So that’s really cool. And the sustainably benefits of AWS cloud are largely recognized by these folks. They are partnering with us. They understand the benefits, primarily driven through economies of scale. So about two-thirds of the benefits that you see from an environmental standpoint. And those benefits could be summed up, on average, you gain anywhere between 3.6 and five x improvement and efficiency depending on the region you’re in. And you reduce your carbon footprint anywhere between 80% and 90% depending on the region that you’re in, on average globally. Two-thirds of that comes from economies of scale. We’ve got our engineering teams are heavily focused on building the most efficient, sustainable infrastructure that has high utilization rates and runs as efficiently as possible. The other third is related to our use of renewable energy. We’re now the largest purchase of renewable energy in the world. Over 370 projects.
Patrick Moorhead: That was a 2021 announcement, I think.
Christopher Wellise: That’s right. And we continue to accelerate. We’re now at 85% renewable energy. That’s for Amazon wide, by the way, not just AWS. And we are on track to meet our 2030, 100%target five years ahead of schedule. So the other third of those benefits come from our renewable energy procurement.
Daniel Newman: Well, that’s really impressive. Now, as you go through this exercise, Andy Jassy did say we’re probably about 10% of enterprise workloads, a little bit more than that when you look at the whole massive workloads that are in the cloud now. But we’re still somewhat early days, and as customers are in this migration period, are you working with them to quantify that number of, hey, this is how much more you’re driving towards ESG goals and sustainability goals, not to mention maybe some even economies of scale for their businesses by moving to the cloud?
Christopher Wellise: We do. I work closely with colleagues. A team within our group is a DC Divest Team, which actually helps to recycle old assets, handle old assets in a responsible way. And we also do some quantification for some of those customers that are interested in large scale migrations. Our customer carbon footprint tool actually gives you a snapshot of what your workload would’ve looked like in an on-prem environment versus AWS environment. So those are some of the data points that we’re providing for customers.
Patrick Moorhead: Yeah, I love that tool. We talk a little bit about this in the greenroom. I want to bring this up. I do a tremendous amount of C-suite advisory and consulting. And when you come in there, there seems to be a couple different camps. I’m not going to pretend like everybody in the C-suites on the same page. They aren’t. You have one camp who’s trying to, maybe they’re operational, and they’re just trying to squeeze every piece of efficiency out of that. You have another camp that they have to hit their ESG goals, and then have people who have CEO typically who at the end, has to make money and do it in a sustainable way as possible for the shareholders. So my question for you is, first of all, is this something that you’re seeing as well? But is it possible, I think it is, to be sustainable, good for the shareholders and good for the environment. Is that possible? Because, I see that really that gear is locking in with the audiences that I talk with.
Christopher Wellise: Well, the term triple bottom line was coined 30 or so years ago, and we still see that as very true today. Business success and being sustainable are not mutually exclusive. I really believe. And you know, could really break it down into the most common denominator too. You can look at carbon as a proxy for a euro or a dollar. If you’re optimizing for carbon, I can’t think of a single instance where you’re optimizing for carbon and you don’t benefit from a cost perspective as well. Because, you’re typically driving additional efficiencies into the processes that you’re engaged in.
Patrick Moorhead: That actually makes sense. If I look at the Brownfield environments in particular, whether it’s manufacturing, whether it’s transportation, whether it’s warehousing, what I’m seeing a lot of action is, and whether we call it IoT on a horizontal basis, but it’s smart manufacturing, smart distribution. It is saving energy, and using less resources, and it’s having a positive impact. The bottom line now, I mean, look in Western Europe with energy prices, there is no doubt if you can find a way to use less energy, you are going to save money and it is going to hit the bottom line. And I don’t like sides. I mean, it is a reality as humans sometimes we bunch up together. But I think if we are going to do this right, we need a rallying cry that there’s something in it for everybody.
And I have yet to find a person on any side that doesn’t agree with… Using less to do the same, that’s actually a good thing. We should try to do that. And that everybody we’re unfortunately in some polarizing corners. I see. And I think that’s inhibiting the ability to move this forward as a planet.
Christopher Wellise: Absolutely. And I mean, if you look at just simply investment and the rise of ESG funds, for instance, sustainability over the last 10 years has become so fundamentally integrated into the C-suite and core business strategy. Adam on stage is a perfect example of that. And Andy’s commitment as well to sustainability. You’re seeing that with our customers as well. I’m not surprised when I meet with customers, and I often hear that sustainability is on parody sometimes with cost that they’re really evaluating. That’s how important it is to our customers. Not all, but some of the sustainability leaders express that sentiment. So it’s really become embedded in the core strategy of businesses.
Daniel Newman: We’ve done a remarkable amount of research on sustainability investment. What’s driving some of the biggest concerns, by the way, from some of our studies, is really that companies don’t feel that they’re moving fast enough to meet the goals that they’ve committed to. And obviously they feel like they’re doing a lot now, but they still see so much in front of them in order to accomplish. I do think that there is a bifurcation between those trying to utilize ESG as a short term architecture versus companies that understand a long term business strategy. Companies that see the horizon, because you might have to rebuild a new factory from the ground up to be sustainable. You can’t always brownfield these things. The point is, year one and two, you may take on some significant capital expenditures to get there. You need to get your shareholders in line, you need the business line.
But over the 10 years that follow that, it’s like lead buildings. There’s been a lot of debate about the lead, because the problem is, in the short term, companies had to absorb a lot of cost to get these buildings to where they needed to be over the next 10 or even businesses, which should be thinking 50 and 100. These are generational. That’s where the economics get really good. But a lot of businesses don’t see past the quarter. And I like to yell at Wall Street about that, but they can’t see long enough to get out there. So having sustainability, a new narrative, a new track that talks about it through this lens of 10, 20, 30 years like we do about the Paris Accord like we do, doesn’t unfortunately always match the street. But if it does, I think we’ll get a lot more buy in.
Christopher Wellise: Yeah, I agree. And people often ask me, where do I see this field heading? The space around sustainability? And I think that the future Amazon’s maybe 10 years from now will be sustainability native companies.
Patrick Moorhead: Interesting. I’ve never heard that term.
Christopher Wellise: Not just tech native companies, they talk about decarbonization. It’s highly complex. We’re faced with the same challenges with our own business as our customers are. And half the technologies that will drive decarbonization, they say, don’t exist today. So it’s going to require major investment and major innovation. We’re going to need to source low carbon components for the racks we build that get deployed within our data centered environment. So we work carefully with our suppliers to see how we can partner on that front. But that’s going to be required in every industry. And it’s not an easy task.
Patrick Moorhead: It’s not. And if you look at where some of how our biggest challenges in the past hundred years have been solved, a lot of it has to do with a combination of, there’s research which is funded by various entities and governments and the VC community, and then there’s big companies. So I’d like to see the big companies come together and find really to try to solve some of these biggest challenges. Not in an incremental way, but truly in a way that makes parabolic improvements in this. I know it’s there. I mean when mankind put puts its stamp and its desire to do something, we figure out how to do that and that. That’s what I hope we can do Chris.
And Chris, I just want to thank you so much for coming on the show, and it’s great to talk face to face about this because we’ve done so much research. It’s funny, we got a PDF where we have a small conversation here, and we’re trying to figure out who I am. But getting you in front of our audience and all the folks out there, I think is a really big benefit. If nothing else, just on the education of maybe how they can strive to do things different, maybe based on some of the things that you’ve done, where you were able to trail blaze out there. So we’d hope to have you on again at a future time.
Christopher Wellise: We’re always learning, right? It’s a big challenge. So we continue to iterate and learn constantly. So it’s been a great conversation with the both of you. I really appreciate it. Thank you.
Daniel Newman: Thanks. Chris. All right, everybody. You heard it here. We are, The Six Five on the Road at AWS Reinvent 2022. We are broadcasting from the win, enjoying each and every one of these conversations, talking cloud, talking business, innovation, sustainability, and the future. If you like what you heard, hit that subscribe button. We’d love to have you as part of our community, check out all the videos that we did here at AWS Reinvent. And of course all the videos that Patrick and I do on The Six Five. For this episode though. Time to say goodbye. See you later.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
