Advertising’s green energy push is in full swing, and efforts to build a more sustainable ad tech ecosystem are taking many forms.
Some solutions focus on eliminating energy waste by cutting out unnecessary transactions. Other solutions emphasize offsetting carbon produced by programmatic auctions with green energy credits.
Viant’s new Adtricity carbon impact reduction program, which launched on Tuesday, takes the latter approach. Viant will offer participating advertisers renewable energy credits (RECs) for media purchased through its DSP.
In addition to launching the Adtricity program, Viant also announced a partnership with Ad Net Zero, a nonprofit that promotes ad industry sustainability efforts. Viant is implementing both efforts as it aims to be carbon neutral by the end of 2023.
What are renewable energy credits?
RECs are certificates that document the renewable energy source that provided the electricity used for a specific function – in this case, serving ads through Viant’s platform. Because energy from multiple sources is carried on the same electrical grid, RECs allow businesses to prove they actually purchased energy from a renewable energy provider.
Companies use RECs to keep track of how much renewable energy they’ve purchased in a year. Having these purchases documented by RECs allows companies to demonstrate progress toward their sustainability goals and claim green energy tax credits.
“We buy a lot of electricity to power the thousands of servers we have processing bid requests,” said Tim Vanderhook, Viant’s CEO and co-founder. But rather than buying electricity from an energy producer that uses coal or natural gas, Viant purchases a portion of its energy from solar or wind farms, he said.
Because Viant is purchasing the energy needed to serve an ad, it receives the REC certificate for that transaction. But then it transfers that certificate to the advertiser so the brand can prove it used green energy to serve its ads. Because the REC documents the renewable energy source for the ad transaction, the advertiser has the legal right to claim a reduction in their carbon emissions.
The program isn’t about offsetting energy purchased from less environmentally friendly energy sources, Vanderhook added. “We’re not polluting and then covering it up or trying to offset it by planting a tree. This is literally switching the energy supplier for your supply chain to a renewable power facility from a coal or natural gas power facility.”
The Adtricity program is available to Green-e Climate Certified advertisers, though Viant declined to name any participating brands.
Incentives and disincentives
Because green energy producers earn revenue from energy and REC purchases, the Adtricity program is also a way for advertisers to fund further expansion of green energy infrastructure.
Sustainability is becoming more of a priority for the advertising industry because it’s a priority for brands, Vanderhook said. Eighty-three percent of Fortune 500 companies have stated climate goals, according to a McKinsey report, and ad tech needs to prioritize the same things buyers do.
Of course, ad buyers are prioritizing sustainability because consumers are, too. Seventy-five percent of US consumers are concerned about the environmental impact of their purchase decisions, according to a study by GreenPrint.
“This is capitalism, and it’s about driving revenue and growth,” Vanderhook said.
In addition to its incentive program for buyers, Viant will also be rolling out initiatives aimed at reducing emissions produced by the sell side later this year, though the company declined to offer specifics at this time.
“We see the same ad request 20 times within a few milliseconds. The amount of reselling amongst SSPs has gotten atrocious,” Vanderhook said. “Certainly, there are going to be actions taken to make sure that reselling is no longer acceptable because it’s generating unnecessary electricity use.”
