“The days of just being a buyer and a seller are changing”
Supermajor bp has brought an energy-for-cloud services style deal — first inked with AWS in 2019 — to Microsoft as well, agreeing the “continued use of Microsoft Azure as a cloud-based solution for bp infrastructure and bp supplying renewable energy to help Microsoft meet its 2025 renewable energy goals”.
The deal, in short, involves a commercial trade-off: bp furnishes Azure’s energy-hungry data centres with renewables from its generation portfolio; Microsoft provides heavily discounted cloud-based applications. (Computer Business Review is unfortunately unable to bring our readers the commercial fine print…)
bp announced a similar agreement with AWS in December 2019 as part of a major cloud migration that will see 900+ applications — including real-time oil and gas trading applications, SAP systems for a large global workforce, and major databases that are currently on-premises moved to AWS. (bp is a major user of AWS for its downstream applications, with Azure underpinning many upstream operations).
Today’s bp deal comes as data centre companies (including major co-location providers that host substantial chunks of cloud hyperscaler workloads) increasingly eye power purchase agreements (PPAs): long-term electricity supply agreements “directly” between producer and consumer, rather than relying on market mechanisms like Ofgem’s Renewable Energy Guarantees of Origin scheme.
The bp Microsoft agreement includes a range of other co-innovation projects intended to find synergies between the two companies’ sustainability initiatives.
“Partnerships are changing…”
“bp shares our vision for a net zero carbon future, and we are committed to working together to drive reductions in carbon emissions and fulfil demand with new renewable energy sources,” said Judson Althoff, executive vice president of Microsoft’s Worldwide Commercial Business. “A strategic partnership such as this enables each organization to bring its unique expertise for industry-leading change and the potential to positively impact billions of lives around the world.”
Speaking to Computer Business Review last year, bp’s Stewart Fry, global VP for enterprise IT and security, told us that “partnerships are changing: everybody has got to lean in to the fact that the world is changing and test boundaries.”
He added at the time: “The days of just being a buyer and a seller are changing and AWS were open to a different kind of partnership.
“We were looking for a partnership that was that was bigger than just an IaaS Migration, which is why we announced the power agreement. Data centres are massive power hungry things, and we’ve got a renewables business… It made sense.”
bp’s ongoing cloud migration project is seeing it exit two major European data centres in Canary Wharf, and a secondary centre in Watford. As Fry earlier told us: “We’ve got a whole floor of a [co-located] global switch environment: but we owned all of the equipment; all the infrastructure… it’s a heavy, capital-intensive world and when we decided not to be hybrid it was a relief.”
The agreement comes as bp — which is embarking on a radical restructuring in the face of a collapse in revenues — said it plans to double capital expenditure on digital by 2025 as part of its aggressive business transformation.