Adani Group to Power Google’s Cloud Services in India

Google has announced partnership with the Adani Group to power its cloud services and operations in India.

The collaboration is a part of Google’s global strategy to achieve net-zero emissions across all its our operations and value chain by 2030.

Adani will supply clean energy from its new solar-wind hybrid project located in the world’s largest renewable energy plant at Khavda, Gujarat. This new project is expected to start commercial operations in the third quarter of 2025, according to a press release.

With proven capabilities in delivering large scale wind, solar, hybrid and energy storage projects, Adani is well-positioned to provide customized renewable energy solutions to commercial and industrial (C&I) customers to meet their energy requirements and reduce their carbon footprint, the company said.

Google’s net-zero initiatives:

Google’s strategy to achieve its net zero goal includes blending wind and solar power sources, increasing battery storage, and using AI to optimize electricity demand and forecasting.

Among other, its net-zero initiatives include:

• Net-zero target for renewable energy: By 2030, operate all data centers on carbon free energy, 24/7
• Reducing 50% of its combined Scope 1, 2, and 3 emissions (base line 2019)
• Investing in carbon removal: Using nature-based and technology-based solutions to neutralize remaining emissions
• Increasing clean energy procurement

The Indian banking sector is taking a green leap!

As per IEA estimates, India requires Rs 160 billion per year till 2030 for its energy transition/decarbonization journey. That means the country has a large opportunity for green funding. It could be met with a combination of domestic and international funds. As a first respondent, domestic funds would be the target.

India’s plan to establish a Green Bank by 2023 could significantly impact the global market, despite requiring an estimated $1.5 trillion investment by 2030. On January 25, 2023, India issued the first tranche of its first sovereign green bond worth INR 80 billion (equivalent to $980 million). On February 9, 2023, the Government of India announced the issuance of another INR 80 billion ($968 million) in sovereign green bonds.

For the last couple of years, Indian entities including financial institutions have been cautiously taking steps towards green financing. But it is not visible yet. However, a few headlines that caught my attention in the last few days stamp the inevitable.

Google, HSBC to offer venture debt financing option to GCR-Sustainability
HDFC Bank raises $300M through maiden sustainable finance bond
The DBS Bank supports the Indian arm of Louis Dreyfus to achieve sustainable finance for RSPO-certified palm oil procurement
SBI raises $250 million through green notes

Incidentally, the Indian banking sector is working towards achieving net-zero targets by 2070.

Sustainable initiatives from the banks are no longer limited to extending support through CSR, digitization, or green energy adoption. These are taking the shape of true green financing products.

The Indian banks have embarked upon a slew of measures to support sustainable finance. Besides issuing green bonds, the banks are showing a keen interest in financing green infrastructure, renewable energy, water, and waste management projects, among others.

No longer is the Indian bank transacting in a silo. A majority of the banks have gone paperless and are adopting renewable energy to promote sustainability internally. They are giving more weightage to the green factors while dealing with the external stakeholders.

And it is not just the global and domestic compliances that have triggered the change. They are active participants in the call to action to save planet Earth and limit the global temperature to pre-industrial levels by Paris goals.

Green banking-the current scenario:

According to reports, the combined net profits of 32 listed private and public sector banks (PSBs) rose 40.56 percent to close to Rs 2. 29 trillion with both sets of banks crossing the Rs 1 trillion mark in net profits and a few recording their highest-ever net profits.

Indian banks are introducing new financial products linked to green initiatives, attracting investment and encouraging businesses to adopt greener practices. There is a shift from investments only in the renewable sector to more sectors now.

The banks have a social responsibility to promote sustainable practices, including environmental contributions. Sustainable finance involves financing both current and transitioning to environmentally friendly performance levels.

India has two finance organizations, Tata Cleantech Capital Limited (TCCL) and the Indian Renewable Energy Development Agency (IREDA), focusing on clean energy financing. IREDA provides funding for projects and plans to launch India’s Green Window, aiming to attract over Rs 210 billion in renewable energy investments. TCCL, a leading private sector Green Bank, has financed over 250 projects, reducing carbon emissions by nearly 16 MT annually.

SBI has launched the Green Chanel Counter and collaborated with Suzlon Energy Limited to generate green power. Other initiatives include tree planting, rainwater harvesting, and solar lamps in rural areas.

Indian banks focus on supporting environmentally friendly projects like renewable energy and agriculture to reduce their carbon footprint.

Global interest:

Green finance is gaining momentum in India’s economy as a tool for transitioning towards net-zero emissions. International organizations like the Asian Development Bank and World Bank have increased funding for green projects in India to reduce the gap in commercial investments in renewable energy and boost investor confidence. Indian green bond issuances reached $21 billion as of February 2023, with the private sector contributing 84% of the total.

Challenges:

Since 2007, India has promoted green financing, with Green Banks adhering to strict environmental standards. India’s green financing, including sustainability-linked loans, bonds, and equity investments, is undergoing continuous evolution, with increased demand driving innovation in this area. Currently, creating a Green Bank is unregulated, but effective regulation requires disclosing carbon emissions.

Green banks face challenges driving a reformative shift towards a sustainable economy, including limited funding, political and regulatory uncertainty, lack of awareness, limited market demand, risk management, and scalability. Additionally, they may struggle to expand their operations and finance larger projects.

How to overcome these challenges:

Green banks can promote sustainable finance by enhancing public awareness, increasing access to capital, developing safeguarding policies, focusing on innovation, and building a tailored track record.

Technology plays a significant role in green finance, enabling banks to comply with reporting rules, improve practices, and model climate risk, with growing awareness of its potential.

The other methods are:

Creating marketing campaigns
Collaborating with other financial institutions
Working with governments to implement regulations requiring financial institutions to report on their ESG performance
Partnering with established institutions on sustainable projects

Our take:

The Indian government should allocate capital towards regional green banks and windows, using low-cost public funds and government guarantees to finance renewable energy projects and reduce carbon emissions.

HSBC and Google Cloud have partnered to expedite climate mitigation and resilience for businesses participating in the Google Cloud Ready (GCR)– Sustainability program through funding and support.

As part of the partnership launch, HSBC is financing LevelTen Energy with venture debt. LevelTen Energy is a GCR-Sustainability-validated company that facilitates over $5 billion in clean energy transactions.

Google Cloud plans to increase the number of partners in the program over the next two years. HSBC plans to secure $1 billion in climate tech finance for companies within the GCR-Sustainability ecosystem, aiming to connect with its customer base.

GCR-Sustainability is a Google Cloud validation program for companies aiming to reduce carbon emissions, enhance sustainability in value chains, and identify climate risks through ESG data processing.

During a declining investment in climate tech start-ups, partnerships and innovative financing solutions are crucial for accelerating growth and developing scale-appropriate solutions, said Natalie Blyth, Global Head, Commercial Banking Sustainability, HSBC. “By combining financing support, cloud technologies, and connectivity to partners across our combined footprints, we will help climate tech vendors accelerate their growth, and develop the solutions we urgently need at scale.”

“The scale of climate challenge requires a global ecosystem of technology providers bringing solutions that drive impact,” said Justin Keeble, Managing Director, Global Sustainability, Google Cloud.

Ross Trenary, Chief Financial Officer, LevelTen, said, “This venture debt package will enable us to scale our platform, which provides transaction infrastructure for carbon-free energy buyers, sellers, and financiers. HSBC’s global reach aligns with our international presence while giving us opportunities to connect with HSBC clients that are looking to achieve green goals.”

Google has signed market advisory firm Deloitte as its first global systems integrator (GSI) for the Cloud Ready Sustainability Program.

The Google Cloud Ready (GCR) Sustainability Program validates Google Cloud-aligned organizations with business-ready technology to help customers achieve their sustainability goals.

The partnership:
Deloitte uses generative AI and geospatial data to help clients mitigate climate risks, adopt green solutions and unlock the value of low-carbon products and services.

As a GCR-GSI, Deloitte is already leveraging its industry and domain knowledge with Google Cloud’s technology and platforms to help customers transition to a sustainable future.

The two companies are enabling customers globally to create economic pathways toward zero emissions.

Solutions and use cases:
The electrified Fleet solution includes integration of global fleet telematics data, resource optimization and ongoing impact monitoring for customers to map their electrification journey.

Freight and logistics:
For instance, Deloitte is using the solution to help Purolator, an integrated freight, package and logistics solutions provider in Canada, to map its net-zero transportation journey.

Purolator aims to reduce Scope 1 and Scope 2 GHG emissions by 42% by 2030 and reach net-zero emissions by 2050. Deloitte developed a strategic roadmap that included assessing vehicle types, usage patterns, and energy options, achieving emissions reduction and electrifying 60% of last-mile delivery vehicles by 2030.

FSI:
Deloitte and Google Cloud are using geospatial analytics to enhance visibility and gain new insights to climate risks across lending and investment portfolios in the financial services industry.

The National Westminster Bank (NatWest), a major bank in the United Kingdom, leveraged geospatial data from Google Earth to capture climate-related data points across its commercial banking portfolio.

Google Cloud, Deloitte and Climate Engine used the geospatial technology to provide new data points and insights to assist NatWest with its climate reporting obligations — e.g., the EU Taxonomy and Taskforce on Nature-related Financial Disclosures (TNFD). Secondly, the data was also used to support their customers’ own climate and nature data collection. The information allows farmers to build a tailored picture of the challenges such as flood, drought, fire and biodiversity risks, at the field-specific level.

The road ahead:
Going forward, Deloitte and Google Cloud’s global initiative will focus on sustainability, climate, and equity, helping clients transition to zero-emission energy, sustainable capital markets, and equitable communities.

“We are excited to be working with Google to take purposeful action to help mitigate climate risks, unlock the value of sustainable products and services, build green communities and green jobs and accelerate our progress toward a global net zero future,” said Jamie Sawchuk, Partner and Global Sustainability Leader, Alphabet Google Alliance, Deloitte Canada.

“Through this program, Deloitte and Google Cloud can leverage our unique roles to help bolster the momentum to address climate change with cloud-based technologies and AI,” said Justin Keeble, Managing Director, Global Sustainability, Google Cloud.

Backdrop:
Launched in 2022, Google Cloud Ready – Sustainability is a partner-led program, aimed at partners committed to helping global businesses and governments accelerate their sustainability programs. The partners build solutions that enhance the capabilities and ease the adoption of Google Cloud technologies such as Google Earth Engine and BigQuery, allowing customers to leverage data-rich solutions that help reduce their carbon footprints.

Google has added offering sustainable aviation fuel (SAF) credits to business customers, as a part of its carbon emissions initiative.

The initiative is targeted at corporate customers willing to slash emissions, ramp up demand in the emerging low-carbon biofuels market and scale up SAF production.

Google’s goal is to reach net zero across all of its operations and value chains by 2030.

“The use of SAF will play a critical role in helping the aviation sector on its path to decarbonize,” said Michael Terrell, Senior Director, Climate and Energy, at Google, in a statement. “Joining Amex GBT’s sustainable aviation fuel program further represents Google’s continued efforts to accelerate the global transition to a carbon-free future.”

Andrew Crawley, President, American Express Global Business Travel, said, “Business travel is a crucial passenger segment for aviation, accounting for around 15% of air travel globally and generating around 40% of revenues. To have Google join our growing SAF program demonstrates how corporate collaboration can accelerate aviation’s transition to net zero and enable more sustainable travel.”

It must be noted that Shell and American Express Global Business Travel (Amex GBT), launched Avelia— the world’s first blockchain-powered SAF ‘book and claims solutions for corporates looking to decarbonise their business travel.

Avelia also aims to demonstrate the credibility of a book-and-claim model, where SAF is delivered into the fuel network, and those airlines and corporations looking to reduce their emissions can purchase the data without physically having the SAF on their flight.

Once the model achieves consensus from industry bodies as an acceptable form of emissions reduction, Avelia could enable airlines and corporate customers to authenticate and report the associated emissions reduction benefits towards their voluntary ESG reporting. If this happens, models like Avelia can further turbo-charge SAF adoption.

Tag: Google

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