Our Commitment to Ecologically Sustainable Online Advertising
With our commitment to the environmental and societal impact, Cavai is leading the way to a more energy-efficient and entirely carbon-free online advertising eco-system.
Where most others stop, we start
While following standards such as GHG Protocol and ISO14061 provides a common starting point for everyone, that is where we see the work of the online advertising industry starts. This can be clearly understood through three points:
- Focusing on funding fundamental research as opposed to just following common nominator standards
- Focusing on energy efficiency innovation as opposed to just replacing fossil fuels with renewable ones
- Focusing on assessing, offsetting, and reporting Scopes 1, 2, and 3 instead of just Scopes 1 and 2
Because online advertising already consumes more than 1% of global energy, we believe setting a high standard for our industry is the most significant contribution we can make.
Fundamental research on emissions caused by online advertising
Every industry is different, and the way industries generate carbon varies greatly. As an industry, we deliver “digital services” (online ads) to roughly four billion internet users, several dozen per day per user. Many additional connections are made to make data collection and other auxiliary functions possible every time an ad is delivered. Moreover, the mere delivery of an ad often involves 10–20 additional connections as part of moving the ad from the ad delivery system to a web browser on a user’s device.
The net result is that delivering online ads constitutes in the order of tens of trillions of connections (between networked devices) each day. Each of these connections consumes energy.
The way things are done today, in January 2022, many such connections can be eradicated, and virtually all the rest can be made more efficient.
Before it is possible to take action, we must clearly understand the problem. Once we understand the problem, we can then take the right actions. Examples of this include articles we’ve already published:
- Environmental impact assessment of online advertising [link]
- Moving Towards Ecologically Sustainable Advertising: Introduction [link]
- Moving Towards Ecologically Sustainable Advertising: The Five Fives [link]
- Moving Towards Ecologically Sustainable Advertising: The Actual Method [link]
- How Much Does an Ad Impression Emit Carbon? [link]
In addition to our own research, we have joined forces with the highly-acclaimed online advertising research team led by Professor Ruben Cuevas in UC3M to start a fully-funded scientific research lab focused on emissions and energy efficiency in online advertising. The lab commenced its work in late 2021, and we will start publishing the findings throughout 2022 and 2023 as they become available.
Energy efficiency leads the way to societal impact
Energy efficiency is best understood by a simple example. Imagine you have a house, where you always have lights on. Regardless of whether anyone is home or if anyone is using a particular room, the lights are always on. The energy for the house comes from fossil fuels.
How do we address this problem by means of renewable energy? We change the contract for the incoming energy from fossil fuels to certified renewables.
How do we address this problem by means of energy efficiency? We adopt a smart-home system that keeps the lights on only when somebody is home and keeps the lights on in a particular room only when someone is in it. Having addressed the actual problem — wasteful use of energy — we then change the contract for the incoming energy from fossil fuels to certified renewables.
There is a further nuance between two kinds of energy efficiency improvements:
- Where business value is compromised
- Where business value is not compromised
Where business value is compromised in the context of the given example, means that due to having a gross system configuration, sometimes lights go off even though the person is in a particular room or go on at night while a person is sleeping and moves around in their bed.
Where business value is not compromised in the context of the given example, means that due to increasing the complexity of the system configuration (i.e., the rules that govern when lights are on or off), lights being on or off closely resembles the expectations of people living in the house.
Energy efficiency is generally a much more complex problem than in the given example, and it is a particularly complex problem in online advertising. We demonstrate this concretely in Moving Towards Ecologically Sustainable Advertising: The Five Fives. Because energy efficiency is a complex problem, it will be very attractive for companies to take the easy way out and focus on buying renewable energy. That will not address the underlying problem, which is that online advertising already consumes more than 1% of global energy, whereas it could be made to consume less than 0.1% instead without compromising any business value.
The responsibility mostly lies on those who own and operate online advertising systems.
Why Scope-3 matters for advertising
The GHG Protocol defines emissions in three scopes. These apply to all kinds of companies and industries, but it’s imperative to clearly understand the implications they have specifically to online advertising.
By the definition of the GHG Protocol, the scopes can be understood in terms of direct and indirect. Additionally, the scopes can be understood in terms of things that a given company is responsible to report, and things that the company is not responsible to report.
What companies are responsible to report, are the direct (Scope-1) emissions, as well as the Scope-2 part of the indirect emissions. In other words, the requirement responsibility of a company can be summarized in three points:
- The company is required to report its direct energy consumption (e.g., office electricity bill)
- The company is required to report the energy consumption of its buildings (e.g., heating cost)
- The company is required to report the energy consumption of its vehicles (e.g., a private bus bringing employees to the office)
As per the GHG Protocol, companies are not required to report anything else.
In terms of companies operating ad delivery systems, more than 99% of emissions come from Scope-3, which companies are not required to report.
In other words, it makes no difference from the standpoint of claiming “Zero Emissions” as per the GHG Protocol if the company is doing all of its ad delivery on fossil fuels without any carbon offsetting or delivering all the ads on renewable energy. The question of the energy source is entirely irrelevant; what matters is who pays the energy bill. In the case of online advertising, except for Google and a few other major companies, nobody pays energy bills.
By assessing, reporting, and offsetting Scope-3 emissions, we set the gold standard for taking responsibility for the direct impact online advertising has on the environment.
For the online advertising industry to become a positive factor in a meaningful, environmentally and societally sustainable future, three critical shifts in mindset are required.
First, companies must invest in fundamental research and capacity development, which can be propriety, open, or both.
Second, companies must focus on energy efficiency primarily and on replacing fossil fuel sources with renewable ones as a secondary measure.
Third, companies must focus on assessing, reporting, and offsetting Scope-3 emissions in addition to Scope-1 and 2.
In this industry, we take pride in our ability to innovate, yet most of the so-called innovation is short-sighted and self-serving. We have now been offered a historic opportunity to demonstrate our ability to innovate. Taking up this opportunity, we will end up inspiring other industries to follow our lead.