In this episode of In Our Hands, Ramanan Raghavendran speaks with Latane Garetson, Director of Physical Infrastructure at Dropbox.
Garetson breaks down the physical infrastructure of data centers and their climate impact and then continues to discuss embracing efficiency technologies, setting targets to reduce environmental footprint, carbon offsetting, and why collaboration is key.
Time stamps and the full transcript are below. This episode is also available on Apple Podcasts and Spotify.
In Our Hands is a production of Amasia. Follow these links for more about our firm, the Amasia blog, our climate fiction podcast, and Ramanan’s blog.
Show Notes
[02:32] The physical infrastructure of the cloud and its impact on climate
[04:32] Achieving 100% renewable energy for data centers
[07:09] The economic benefits of energy efficiency in data centers
[10:10] The challenges of getting renewable energy into multi-tenant buildings
[12:29] Dropbox's leadership in sustainability
[14:24] Is carbon offsetting the most impactful solution?
[15:52] Motivating other companies to take action by understanding their impact
[16:30] Investing in technologies for long-term benefits
Latane Garetson [00:00] We know where we're at. Let's set some targets of what we can do and where we want to get to. But you've got to start there. You've got to start to know what your total impact is.
Ramanan [00:08] Welcome to In Our Hands, a podcast about the challenges and opportunities presented by the climate crisis. Each episode features a new thinker at the front lines of the battle to save our planet. Join us as we delve into the complexities of this global challenge and seek actionable ways to build a sustainable future.
Ramanan [00:31] Hello, everybody. Welcome to the next episode of In Our Hands. Today we have a very special guest, Latane Garetson, who is the director of Physical Infrastructure at Dropbox, where he is responsible for overseeing the finding, building, and maintenance of sites for Dropbox's data centers.
He has played a strong leadership role in Dropbox's forward-looking work to reduce their impact on the environment and help address the climate crisis, while still doing the great things they do. I am a very happy Dropbox customer, so I wanted to mention that right at the beginning. It's of special interest to me. Latane, let's just start with a little personal background. Can you talk to us about your career path and what led you to enter the world of data center infrastructure?
Latane Garetson [01:13] Sure. Thanks for that great introduction by the way. So yeah, so my career path actually began in financial accounting. So I have a finance degree, and I was fortunate to kind of transfer into the data center industry, starting in finance. And then from there I eventually went into more data center engineering world. And it's been an incredible journey. A great group of small, niche-type of people in this industry, and I kind of fell in love with that overall arching scheme. And by doing that, I was able to witness some great technology advancements and just have had a lot of fun in this industry for the last 10-plus years.
Ramanan [01:56] Fantastic. How long have you been at Dropbox?
Latane Garetson [01:59] Dropbox, I've been about eight years.
Ramanan [02:02] Got it. All right. We're going to launch into something pretty much almost all of our electronic world runs on, but very few people understand. Most people think the cloud is this weird, non-physical thing for file storage. But as you know better than the rest of us, it involves some very physical infrastructure. Can you talk us through what that infrastructure is and the effect of that infrastructure on climate?
Latane Garetson [02:32] Sure. So the cloud isn't magic that a lot of people...The easiest term for me is basically, it's someone else's computer. So in this case at Dropbox, it's the use of thousands of computers that house everyone's storage; whether it's their tax returns or pictures or any of their collaborative tools, and we house them in a reliable and efficient manner.
When you think about data centers in general, there's so much energy consumption in that environment because there are thousands and thousands of computers. Some companies do it really well and some companies just throw all these computers into a big room and just run them as inefficient as possible.
[03:18] So I kind of think of an analogy of when you move into a house, you want to just get everything in the house. And a lot of times that's what happens and then people may leave that house, but you want to be in that house and start putting things in strategic ways. And that's what we do at Dropbox. From our data center perspective, we house these things in strategic ways where they're as efficient as possible for the environment and customers, and that ultimately trickles down to the efficiencies that we do here at Dropbox. So think of thousands of computers running in a data center, a lot of electrical infrastructure, a lot of cooling infrastructure, miles, and miles of wire and copper, and all kinds of fun, interesting stuff.
Ramanan [04:03] Got it. And we'll talk about the connection with climate even more deeply as we go along. I just wanted to call out to the audience, it's a question about what Dropbox itself has done by way of progress. In 2020, Dropbox announced its 2030 sustainability goals, which included reaching 100 percent renewable energy for all its operations.
[04:32] In 2021, you announced that Dropbox had already achieved a large part of this goal with all data centers being run on renewable energy. How did this magical thing come about?
Latane Garetson [04:35] Yeah, so two big parts of this is the biggest thing on our end was, it's easy to get to this renewable world from just an investment standpoint; you could buy renewable energy attributes or whatever that is, but our biggest thing was to reduce our carbon footprint, like actual carbon footprint, right? And one of the big things that we did was we invested heavily in automation. And in that automation for our servers, we're able to power down servers when they're not being used. This is really challenging for a lot of companies and fortunately for Dropbox, we have some great engineering teams so we invested in automation where we actually powered down the servers when they weren't needed.
[05:23] This reduced our carbon footprint by 5 to 10% out the gate. And so that helped kind of sell this story to management, right, where then we could fund the other additional stuff that we couldn't necessarily get all renewable through energy attributes and that kind of area. So yeah, to answer your question, we invested heavily in that automation front at first. There's a blog post about it, about more of the technical side. And then from there, we got leadership approval and started investing in the renewable energy side of the world.
Ramanan [05:59] We would love to get a link to that blog post. Because when we put our podcast out, we actually provide an intro and a full transcript and we'll embed the link there so people can go look for more.
Latane Garetson [06:11] And the last part on that... I have to throw a plug-in here.
Ramanan [06:15] Please.
Latane Garetson [06:16] We have a very passionate internal team, the ESG team and social impact, and Jackie Horton and the team there, they have accelerated that commitment with us. So we had a strong partnership. They saw the passion on the physical infrastructure side with the automation thing and then they helped pave the way for the rest of it.
Ramanan [06:39] Thank you for that. So I'm now going to ask a question about economics. You know what's interesting, and it relates to the Amasia investment thesis, which I won't blow our horn about, but the best things are things that are win-wins. And it so happens that making the data centers much more energy efficient also results in lower energy bills, which I'm sure is a huge expense line item. Without the economic benefit, do you think you'd still have been able to achieve what you've achieved?
Latane Garetson [07:09] Certainly not as fast as we were, but you have to remember when we did this 2020 commitment, we didn't know, we didn’t do the due diligence on the financial impacts yet. So we just said, "Hey, look, we need to get here," and it wasn't a dollar thinking first. It was an environmental thinking first. I think the acceleration from the 2020 or the 2030 long-term goal is actually pulling in so quickly was driven by some of the financial benefits.
Ramanan [07:41] Got it. Super helpful. You guys don't operate in a vacuum. The data center doesn't sit on an island that, well, maybe some of them actually do sit on an island, but they don't sit on an island with no other interconnectivity. It involves a whole range of ecosystem participants who are partners, landlords, public utilities, and public cloud partners of different kinds. What are some of the benefits and challenges of dealing with that wider ecosystem?
Latane Garetson [08:05] Yes, so there's definitely some...The benefits are that there are so many partners and that people really care about their commitments to the environment and it's starting to become a much more socially aware and...From when I started till now, a lot of renewable and environmental areas is a big focus with landlords and partners, which is great. There's still a lot of hurdles. At the end of the day, my biggest goal is to get renewable energy as close to the electron as we consume. And that's the most impactful.
[08:46] For people like Dropbox who don't own their own land and build and own all of that partnership with utilities, it's challenging. We work through landlords. And the landlord side works with the utility provider. And the best way to get, as you know, the closest to the electron is through the utilities themselves and you enter into a PPA agreement or whatever that is. Our challenge now is to remove that middle person and somehow get into these PPAs with the utilities directly or partner with all three of them. And that's the challenging part is to get all three or four groups aligned to get that electron as close as possible.
Ramanan [09:29] Super helpful. I had not thought of it that way, and I think our audience, their eyes will be opened.
Latane Garetson [09:35] Yeah. I'm going to jump into this, I’m a little bit more passionate in this area.
Ramanan [09:40] Please. Please.
Latane Garetson [09:40] The real change here is, right, you have to think of a landlord and they make this huge investment in this building or campus, you think of the big providers. And they have multiple tenants in this building, but they only have one meter from a utility provider that serves that electricity.
Latane Garetson [10:10] And so the only way to get direct renewable energy into that facility is to enter into a PPA with that utility provider. But now you have 10, 15 customers in this building that probably don't want to pay a premium on the PPA. So the landlord is not very incentivized to go after a PPA because they would get on the hook for, you know, these are long-term commitments.
So there's this game that it's hard for the landlord to commit to a 10, 20-year PPA if they only have tenants in there for five years, six years, multiple tenants. So you almost have to get everybody, every tenant, on this campus to agree to that PPA and that long-term commitment. So if there's a way to contractually come up with a creative solution, like someone like Dropbox that wants to invest more in PPAs, however, now we're blocked essentially by the 10 other tenants in that building or the landlord afraid to make that premium commitment. So how do we bridge that gap? It's really interesting and we're always talking and trying to convince landlords to step into that arena.'
Ramanan [11:18] With some success or limited success?
Latane Garetson [11:21] Limited success. So a lot of them will claim the, "Hey, don't worry, we have 100% renewable," and then we come and peel back the onion a little bit and they're just buying renewable energy attributes on behalf of their energy, right? And it's like, "Hey, look, Dropbox could do that same thing, but we'd rather choose where we're doing that in the most impactful way." So our goal is to get as close to electrons as possible, but there are definitely a lot of hurdles when it comes to that. And I think that's the case for a lot of software companies that have data centers that don't necessarily own their land and their building.
Ramanan [12:00] I'm glad you went into some detail on this because our audience is mostly VCs and founders and this may spur ideas in their heads on how to maybe spawn something entrepreneurial that can help in this regard. I'm going to switch gears again and come to the fact that, look, you guys feel like a leader in the area. Have other companies looked at what you're doing or been sort of vaguely aware of what you're doing and begun doing some of this themselves?
Latane Garetson [12:29] So to be honest, as mentioned, I'm a data center physical infrastructure person. I'm not necessarily one to read all the environmentals, what everybody is doing. That's our social impact group. But I know we've had a couple of analyses and I've been told that we're actually beating most of our peer companies in our commitments and our actions; so that we're actually doing.
Whether people are changing because of Dropbox is hard to say. I think we try to make ourselves aware. We just produced our fact sheet, our 2022 fact sheet, and our environmental impact report. So I'm hoping that people can follow.
[13:13] At the end of the day, there's the efficiency side of the servers that is super important from a data center perspective. And the great part about Dropbox is we are one of the first adapters of a lot of these new technologies, specifically in the storage world. And we're paving that way from a first adapter of technology, like extremely dense hard drives, and that extremely dense hard drives lead to ultimate efficiencies and reductions and we're hoping that other companies see that. And we're doing a lot of external blog posts and partnerships with our hard drive vendors to really showcase that. And we're hoping that fills into other peer companies as well and kind of lead that way.
Ramanan [14:02] Got it. Super helpful. I feel like carbon offsetting sort of hit its peak and is now the subject of widespread skepticism. Without expressing my personal viewpoint, what I can say is many companies are relying on carbon offsetting to meet their sustainability targets. Do you have thoughts on that topic?
Latane Garetson [14:24] So it's definitely an interesting, complex issue. I think at the end of the day, like I said, I'm a physical infrastructure person and efficiency is what I care about. But I acknowledge, hey, short-term investments in carbon offsetting are valuable. I still think they're valuable. If you're not going to do anything, at least you can start that and that could become that flywheel for companies at some point.
You start investing in this and then it starts maybe generating in a different area. And so they're not the most impactful solution, especially in the long run, but if you have that part of your strategy and your ultimate strategy to prioritize your actual emission reductions is important, but don't use that as the end all, be all. Use that as the tool, as part of your strategy, to ultimately get to a more actual reduction versus just the offsetting portion.
Ramanan [15:25] You couldn't have said it better. I agree with everything you've said. I've said variations of that to other people as well. So thank you. All right, we're going to get to our last question. Look, one of the things we want to do with our podcast is inspire other people to take action. That is a big reason why we do this. What would you say to motivate other companies to take similar actions to get to net zero or whatever variation of that phrase they use?
Latane Garetson [15:52] The first couple of things is really to understand what your overall impact is. Do that accounting part. That accounting part is a small investment, in the long run, to really see where you're at.
And if you're struggling with leadership or anything like that, if you could get that accounting perspective and say, "Look, here's our total impact here. This is what we're doing." Build that baseline and then start looking at ways to reduce that. And we've seen great benefits financially on just really diving into the details on the efficiency side from a data center perspective. Like you mentioned, the utility bills have gone down tremendously once we started rolling out some of this automation.
Latane Garetson [16:30] We save a lot in the denser hard drive world. So invest in these technologies because ultimately you're going to be saving in the long run. That ultimately goes down to your overall environmental story. And for us, it's like we've got the accounting, we said, "Okay, we know where we're at, let's set some targets of what we can do and where we want to get to." But you've got to start there. You've got to start to know what your total impact is.
Ramanan [17:05] Well, and we promised our audience, we didn't sort of trick Latane into talking about this, but we have multiple carbon accounting software companies in our portfolio.
Latane Garetson [17:16] Oh, nice.
Ramanan [17:16] So we are in massive agreement that you've got to start with the data. I promised you this would be short and painless, and this has been short and painless, I hope. In a short podcast, you've communicated a ton of really useful info. I want to thank you for your time and I wish you the very best in continuing to move Dropbox along to its goals.
Latane Garetson [17:36] Appreciate it. Thank you.
Ramanan [17:40] Thank you for listening. Please email us at climate@amasia.vc with any suggestions or ideas and visit inourhands.earth for the full transcript of this podcast and other information.
Ep. 19. Latane Garetson on the Climate Impact of Data Centers