Nokia looks to cut telco energy bills

Nokia has unveiled the latest iteration of its energy-saving software to help reduce power usage in telecoms networks.

There is, of course, an important sustainability angle here. But the ability of the software to help telcos cut their energy bills might well be a more important selling point in the short term, as evidenced by the number of operators globally to have reported the impact of ever-increasing energy prices in their latest financials.

The Finnish vendor has upgraded its AVA Energy efficiency software, adding in improved Machine Learning algorithms to help reduce power consumption in data centres, base stations, batteries and air conditioning units used in telecoms networks. The enhanced algorithms enable telcos to shut down idling and unused equipment automatically, and gives them the option to completely disconnect hardware through remote power control modules, Nokia said. As such, it claims reduced power consumption of up to 30%, an increase of around 10 percentage points compared with the original software, which has been around for a couple of years.

The figures come from customer testing, it said. Nokia has north of 50 completed or ongoing energy saving projects based on AVA with telecoms operators worldwide.

Its most recent customer announcement was just last month at Mobile World Congress. The vendor presented O2 Germany as its latest its AVA for Energy SaaS solution customer, having added the software-as-a-service element to the portfolio a year earlier.

In its recently-published annual report for 2022, parent company Telefonica cites higher energy costs as having had an impact on its financials in most of its key markets, including Spain, Germany and the UK, and reiterates its renewable energy and energy efficiency goals. At group level the telco is managing to keep its energy consumption flat despite increasing traffic, its total coming in at just over 6.1 million MWh in 2022, versus closer to 6.2 million MWh the previous year. While that’s a laudable effort from a sustainability point of view, the increasing cost of that energy has to hurt.

Naturally, Telefonica is not the only big telco feeling the pinch from energy prices. BT’s numbers for the end of last year didn’t look great, and the company noted that its energy costs increased by 80% during the year. Meanwhile, Telia cuts its 2022 earnings guidance in mid-year as a result of rising energy prices, noting that its energy cost increase for the year would be around 900 million kronor (US$88 million), or SEK600 million higher than it had predicted a few months earlier.

Those are just a few examples of many. Indeed, Nokia quotes data from Analysys Mason that shows telecoms operators spend between 3% and 20% of their total revenue on energy costs. For the big operators, that’s a huge sum.

Telcos identify efficient energy consumption as a strategic imperative for their businesses, “and they want tools that will meaningfully help meeting increased network customer demands while lowering energy consumption,” said Michela Venturelli, Senior Analyst, at Analysys Mason, in a quote shared by Nokia. “This latest Nokia AVA Energy efficiency solution is a solid contribution to those ends,” Venturelli said.

Increasing network traffic and stringent commitments to emissions-reduction targets – coupled with the cost issue – mean that these kinds of tools will continue to be important to operators. As a result, we will likely see more initiatives from Nokia and its rivals offering multiple-percentage-point reductions in energy usage as the year wears on.

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