Detailed, Bottoms Up Measurement and Improvement of Our Primary Internet Backbone
Our engineering team, working in conjunction with our equipment suppliers, has developed detailed specifications of the amount of electrical power used by each piece of equipment on our network. Combining this data with our daily network inventory records allows us to calculate the total energy consumed on any given day at each of our 3,000 network locations and network traffic records enables us to calculate the total traffic volume carried across the network at the same interval. Locational data combined with carbon factor information provides us estimates of the GHG emissions emitted across our network as a result of our network activity. Based upon these calculations which solely estimates our network operations and associated overhead, we used in 2020 approximately 38.3 million kWh to power our network and we estimate that this power usage emitted approximately 18,500 mt CO2e. We intend to use this transmission data to strategically measure, analyze and over time to reduce, on a per Byte basis, the amount of electricity we use and the GHG we emit.
Below is a table outlining data regarding our network transmission volume related to our costs of goods sold, capital expenditures, estimated kWh consumed and estimated amount of GHG emissions all these ratios indexed to 2016:
| Cogent Network Transmission Efficiency Metrics (Traffic Volume Indexed to 2016 equal to 100) Annual Cost of Goods Sold, Capital Expenditures, Electricity, and GHG Emissions are divided by Annual Traffic Volume with 2016 as the Base Year Equal to 100 | |||||
|---|---|---|---|---|---|
| Traffic Volume | Cost of Goods Sold | Capital Expenditures | Electricity (kWh Consumed) | GHG Emissions | |
| 2016 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 |
| 2017 | 123.5 | 87.4 | 82.4 | 91.3 | 90.5 |
| 2018 | 171.7 | 65.8 | 64.6 | 75.1 | 74.5 |
| 2019 | 226.5 | 49.9 | 45.8 | 64.0 | 57.8 |
| 2020 | 312.9 | 36.0 | 39.6 | 50.3 | 41.5 |
| CAGR | 33.0% | -22.5% | -20.7% | -15.8% | -19.8% |
Certain assumptions regarding the table:
1) Traffic volume represents the amount of Bytes carried by our network backbone over an entire calendar period.
2) Traffic volume is indexed to 2016 as the base year equaling 100. For 2016, the other statistics are also indexed to 100 for the ratio of those statistics to traffic volume. The output in the table for the Cost of Goods Sold, Capital Expenditures, kWh Consumed and GHG Emissions represents the amount of each used relative to the amount of traffic carried. . A number lower than 100 indicates that Cogent is utilizing less of that input per traffic volume.
3) Cost of Goods Sold and Capital Expenditures represents the amount spent by Cogent for the corresponding fiscal year. kWh Consumed and GHG Emissions represent kWh hours and mt CO2E, respectively.
4) kWh Consumed is an estimation of the entire amount of electricity consumed by Cogent to run its Internet Backbone network. This figure includes detailed, bottoms up estimates of the power consumption per network equipment based upon Bytes transmitted. In addition, there is a 50% overhead addition in order to estimate the additional power usage associated with HVAC, lighting and other activities. This figure does not include the amount of electricity consumed by Cogent to operate its own Cogent Data Centers (see below) and other associated operations including sales offices and administrative offices.; Cogent did not include these numbers in order to provide a more precise figure as to the energy required to run its Network backbone and to focus its efforts on reducing electricity and carbon emissions from this important activity.
5) GHG Emissions is an estimate of the carbon produced by Cogent’s Internet Backbone. kWh production by network equipment, by location, is multiplied by a Carbon Factor for the geographic location reported by certain governmental agencies including the US EPA eGrid Report. This calculation provides an estimate of the amount of Carbon produced by each piece of network equipment plus an overhead factor of 50% to reflect other power usage for HVAC, lighting and other requirements. Reported Carbon Factors for 2018 were used for 2016 and 2017 as suitable Carbon Factors were not available for those years. Carbon Factors estimates the amount of carbon produced per kWh for certain countries and in the case of the United States, Canada and Australia certain states and provinces. Certain countries which did not report its Carbon Factors during these periods were given estimates based upon adjacent countries and later reporting factors. These countries accounted for less than 5% of Cogent’s reported Carbon emissions.