Due to the geopolitical situation and the recent black swan events that have plagued world history, one of the unfortunate effects has been the cost of fuel. Fuel prices have risen since mid-2021 as the global population recovered from a pandemic. The demand for commercial and industrial markets to produce again spurred an increase in demand for fuel and energy markets leading to a sharp rise in the cost as supply stayed the same.
Russia’s recent invasion of Ukraine proved to be another factor in the increase of fuel costs, particularly around Europe. From the start of the invasion to around the mid of the year, European fuel and electricity costs rose by an average of 115% (109%) and 237% (138%), respectively.
Since crude fuel is one of the main sources of power production, an increase in fuel prices would almost certainly result in an increase in the price of electricity. According to the UK House of Commons, energy costs rose by 54% in April 2022 and were projected to rise by an additional 80% in October. The technology industry faces a sizable financial risk as a result of the rising cost of electricity, which is unlikely to abate in the near future.
Data centres are significant power consumers, especially those that house sizable computer processing hardware that is used by corporations as virtual machines. Servers and other technology used to store, process, and distribute digital information are housed in these enormous buildings. These facilities frequently run around the clock and require a steady supply of electricity to keep their servers working.
Another challenge for data centres is managing the large amount of heat generated by the VMs. Mechanical components, processors, graphic processing cards, and storage devices generate tremendous heat. This heat can cause hard to the physical devices and thus need to be managed. Most data centres use cooling techniques like central cooling, Air conditioning, or Large fans to dissipate the heat. All these cooling options also require a significant amount of electricity consumption.
The rise in power costs has forced many data centre operators to find ways to reduce their energy consumption. This can include implementing more energy-efficient technologies, such as more efficient servers and cooling systems, and using renewable energy sources. In some cases, data centre operators have even decided to relocate to areas where electricity is cheaper.
Organizations are adopting a revolutionary method to migrate to the cloud instead. Cloud migrations are allowing organizations to skip the bill for large, expensive to run and maintain data centres and focus on just building their infrastructure on the cloud.
Most cloud service providers have enormous data centres that dwarf the size of traditional data centres any organization can hope to maintain. It comes as no surprise these behemoths consume around 1% of all energy generated worldwide!! (that’s about 200 terawatt hours of power a day).
With such a need for electricity, its in Cloud Providers’ best interests to create efficient data centres that provide the best processing and computational power with cost optimization in mind.
AWS is the world’s leading cloud provider with the most significant market share in Cloud usage and migrations services. Recently AWS has revamped its famous Well-Architected Framework to include an additional pillar — Sustainability. AWS has a vested interest in setting up Data centres that reduce their carbon footprint, employing technological advancements such as compute resources and Virtual Machines that consume less electricity.
Their latest offering, The EC2 instances based on the AWS Graviton processor, is designed to be more power-efficient than other EC2 instance types. The Graviton processor is built using Arm Neoverse cores and is optimized for cloud workloads, which allows it to deliver high performance while consuming less power than other processor architectures. Graviton Instances can help you save on power costs and reduce your environmental impact when using EC2 instances.
Additionally, AWS has started to build data centres more sustainably. AWS Does this by Reducing energy usage. AWS employs advanced cooling methods, such as outside air cooling in many of its data centres, which can reduce energy consumption by up to 75%. Strategically, AWS has begun to place data centres in locations with low temperatures, which can help them use the environment to cool data centres compared to running expensive cooling solutions.
Additionally, AWS is committed to using cheaper, renewable energy. AWS has made significant investments in renewable energy and has committed to achieving 100% renewable energy usage for its global infrastructure. AWS has signed over 50 renewable energy deals with more than 3,000 MW of renewable energy projects in the pipeline.
A result of this optimization is that infrastructure costs for AWS offerings have yet to see a tremendous increase in cloud costs. Additionally, because AWS provides volume discounts, long-term utilization in the cloud is cheaper thanks to various cloud cost optimization options such as Reserved Instances, Saving plans, etc.
Also, because AWS is built to scale, most organizations build infrastructure not to run machinery at all times. Rather applications and software supporting it are designed only to run during operational and business hours and then be turned down. This functionality is impossible in the traditional On-premise environment where data centres are routinely run 24/7 and involve a hefty capital to procure and upgrade to boot. AWS provides multiple options to strategically improve the cost of running your organization. One of them is the instance scheduler — a tool that can be set up to automatically stop and start EC2 instances based on tags and schedules.
Thanks to Spot Instances, AWS has to compute the capacity available to be consumed cheaply. This tool passed incredible savings (Up to 72%) to consumers while allowing them to use capacity that would otherwise be unconsumed and wasted.
These cost savings are made possible for clients by AWS’s combination of cost-optimized architecture and effective data centre design, which makes the decision to migrate to the cloud all the more profitable. Electricity prices are steadily rising, making it substantially more cost-effective to host your data centre in the cloud than on-premises.
It is unnecessary to buy a physical site, spend money on expensive gear, set up maintenance, and hire employees to operate the hardware and data centre because AWS offers scalable, highly available computation and processing capacity on demand. All of which demand a significant sum of money. Most firms have found success with cloud migrations, which may appear to be a significant economic benefit.