Telefónica cuts energy use by 12% despite data traffic surge

Telefónica reports 92% drop in energy use per petabyte despite network traffic rising twelvefold

Telefónica has published figures showing total energy consumption across its networks fell 12% between 2015 and 2025, even as data traffic increased twelve times over the same period. Consequently, the company’s energy use per petabyte dropped 92%. The telecommunications operator attributes the reduction to widespread fibre deployment, 4G and 5G upgrades, and systematic retirement of legacy copper and 3G infrastructure.

The numbers matter because they demonstrate that network traffic growth does not inevitably demand proportional increases in electricity consumption. For UK businesses, particularly those managing data-intensive operations or evaluating suppliers against environmental criteria, the case illustrates how infrastructure choices directly affect energy performance. Moreover, it shows what happens when a large operator replaces older systems with modern alternatives designed for efficiency.

Telefónica now reports electricity consumption of 29 megawatt-hours per petabyte, a significant decrease from 2015 baseline levels. The company says it achieved these results through a combination of technical upgrades and operational changes. Fibre networks require substantially less power than copper. Similarly, 4G and 5G technologies consume far less energy per unit of data than 2G and 3G systems. As a result, modernising the network infrastructure delivered measurable reductions in energy intensity.

The operator has also implemented power-saving features across its equipment and systematically shut down older, less efficient network elements. These actions formed part of a deliberate strategy to stabilise electricity use while expanding capacity. According to Telefónica’s own sustainability materials, the main savings came from upgrading network infrastructure and decommissioning outdated equipment. This approach allowed the business to absorb rapid growth in data demand without a corresponding rise in energy consumption.

How fibre and 5G deployment reduced network energy intensity

Telefónica’s infrastructure programme focused on replacing energy-intensive legacy systems with technologies that deliver higher performance using less power. Fibre-optic networks, for example, use significantly less electricity than copper-based systems to transmit the same volume of data. The company accelerated fibre rollout across its operating markets, which contributed to lower overall energy consumption as copper infrastructure was retired.

Similarly, the transition from 3G to 4G and 5G reduced energy use per bit of data transmitted. While 5G base stations may consume more power in absolute terms, they handle vastly greater traffic volumes. Therefore, energy consumption per petabyte falls sharply compared to older technologies. Telefónica emphasises that 4G and 5G have a much lower environmental impact than 2G and 3G networks when measured against data throughput.

In addition to network upgrades, the company implemented equipment modernisation programmes and introduced power-saving features across its operations. These measures included updating cooling systems, optimising server efficiency, and deploying software controls that reduce power consumption during periods of lower demand. The GSMA published a case study noting that Telefónica had set a target to cut energy consumption per unit of traffic by 85% by 2025 compared to 2015 levels. The reported 92% reduction exceeds that objective.

Industry coverage indicates that in 2025 specifically, Telefónica’s energy consumption fell 4% year-on-year despite network traffic growing 25%. This demonstrates that the efficiency gains continued even as demand accelerated. Furthermore, the company reported 93 energy efficiency initiatives in 2025, which collectively delivered savings of €62 million annually. These figures suggest that energy efficiency measures produce both environmental and financial benefits for telecommunications operators.

What this means for businesses evaluating supplier environmental performance

UK companies increasingly face requirements to assess the carbon footprint of their supply chains. Telecommunications services form a significant part of many businesses’ indirect emissions, particularly for organisations with substantial data use or cloud-based operations. Consequently, understanding how network operators manage energy consumption becomes relevant when evaluating suppliers against environmental criteria.

Telefónica’s results show that operators can reduce energy intensity through infrastructure investment. However, businesses cannot assume all telecommunications providers deliver equivalent efficiency. The age and composition of network infrastructure varies considerably between operators. Therefore, companies evaluating suppliers should consider asking specific questions about energy consumption per unit of data, renewable electricity procurement, and infrastructure modernisation programmes.

For businesses bidding on public sector contracts, supplier environmental performance matters directly. Procurement Policy Note 06/21 requires suppliers bidding for central government contracts above certain thresholds to report carbon emissions and publish carbon reduction plans. While PPN 06/21 applies to direct suppliers, many organisations must also consider their own supply chain emissions. As a result, choosing telecommunications providers with demonstrably lower energy intensity can help reduce reported Scope 3 emissions.

The commercial implications extend beyond compliance. Energy efficiency improvements that reduce operating costs for telecommunications providers may eventually translate into more competitive pricing. Additionally, businesses operating in sectors with high sustainability expectations may find that demonstrating lower supply chain emissions strengthens their market position. Telefónica’s case illustrates that large-scale infrastructure changes can deliver substantial efficiency gains, but these gains depend on sustained capital investment in network modernisation.

Businesses should also recognise that energy efficiency per petabyte represents only part of the environmental picture. Total energy consumption, renewable electricity sourcing, and broader operational emissions all contribute to a supplier’s overall carbon footprint. Telefónica has linked its network efficiency improvements to wider emissions reductions and increased renewable electricity procurement across key markets. Therefore, evaluating telecommunications providers requires considering multiple factors rather than relying on a single metric.

Key facts about Telefónica’s energy efficiency results

• Total energy consumption fell 12% between 2015 and 2025 while network traffic increased twelve times, resulting in a 92% reduction in energy use per petabyte.
• Electricity consumption per petabyte now stands at 29 megawatt-hours, down from significantly higher 2015 baseline levels.
• The company attributes efficiency gains primarily to fibre rollout, 4G and 5G deployment, equipment modernisation, and shutdown of legacy 2G and 3G infrastructure.
• In 2025 specifically, energy consumption decreased 4% year-on-year despite traffic growth of 25%, demonstrating continued efficiency improvements.
• Telefónica implemented 93 energy efficiency initiatives in 2025, delivering reported savings of €62 million annually.
• The GSMA case study noted Telefónica had targeted an 85% reduction in energy consumption per unit of traffic by 2025 versus 2015, a goal the company exceeded.
• Fibre networks require substantially less power than copper systems, and 4G and 5G technologies consume far less energy per unit of data than 2G and 3G networks.

Why decoupling traffic growth from energy consumption matters for UK SMEs

The relationship between data growth and energy consumption affects businesses in several ways. First, companies using cloud services, video conferencing, or data-intensive applications rely on telecommunications infrastructure that consumes electricity. As usage increases, the energy footprint of these services could rise proportionally unless network efficiency improves. Telefónica’s results suggest that infrastructure modernisation can break this link.

Second, businesses reporting carbon emissions under frameworks such as the Streamlined Energy and Carbon Reporting regulations must account for indirect emissions in some cases. While SECR primarily focuses on direct energy use, companies may face questions from investors, customers, or procurement teams about broader supply chain emissions. Understanding how major suppliers manage energy efficiency therefore becomes increasingly relevant.

Third, the telecommunications sector’s ability to reduce energy intensity while expanding capacity offers a model for other industries. Many UK manufacturers and service providers face similar challenges: growing demand, rising energy costs, and pressure to reduce emissions. The Telefónica case demonstrates that investing in more efficient infrastructure can deliver measurable results, though it requires sustained capital expenditure and technical expertise.

For businesses considering their own energy efficiency programmes, several lessons emerge. Infrastructure age matters significantly. Older systems typically consume more energy to deliver the same output as modern alternatives. Therefore, equipment replacement schedules should factor in energy performance alongside functionality. Additionally, efficiency improvements often deliver financial returns through reduced operating costs, though the payback period depends on energy prices and capital costs.

Businesses should also recognise that energy efficiency per unit of output represents a more useful metric than total energy consumption alone. As operations grow, absolute energy use may increase even if efficiency improves. Tracking energy intensity allows companies to separate growth-related consumption from inefficiency. This distinction becomes particularly important when communicating environmental performance to stakeholders or demonstrating progress against reduction targets.

Finally, the Telefónica announcement underscores that large-scale emissions reductions often require infrastructure investment rather than incremental operational changes alone. While behavioural measures and process optimisation deliver some benefits, replacing energy-intensive systems with efficient alternatives produces more substantial results. UK businesses evaluating their own carbon reduction strategies should therefore consider both operational improvements and infrastructure upgrades when setting targets and allocating resources.

Questions businesses should ask telecommunications providers

When evaluating telecommunications suppliers, particularly for companies with significant data use or sustainability reporting obligations, specific questions can help assess environmental performance. Asking about energy consumption per unit of data provides insight into network efficiency. Providers using modern infrastructure should demonstrate improving trends in this metric over time.

Questions about renewable electricity procurement reveal how operators manage operational carbon emissions. Many telecommunications companies now source renewable electricity for network operations, but the proportion varies considerably. Businesses should ask what percentage of electricity comes from renewable sources and whether providers hold verified renewable energy certificates.

Infrastructure modernisation programmes indicate future efficiency trends. Operators still running significant legacy 2G or 3G infrastructure, or relying heavily on copper networks, will likely show higher energy intensity than those who have completed fibre and 5G rollouts. Therefore, asking about investment plans and technology roadmaps helps assess whether efficiency improvements will continue.

Carbon reporting transparency matters for businesses managing supply chain emissions. Providers publishing detailed emissions data, reduction targets, and progress reports demonstrate accountability. Companies subject to ESG compliance requirements may find it easier to work with suppliers who provide granular environmental data that can feed into Scope 3 calculations.

Finally, businesses should ask whether telecommunications providers offer tools or reporting to help customers understand the carbon footprint of their usage. Some operators now provide carbon calculators or emissions data specific to individual customers, which can support more accurate sustainability reporting. These services add particular value for organisations with complex environmental disclosure requirements.

Where to find additional information on network energy efficiency and telecommunications sustainability

The GSMA publishes case studies and research on telecommunications sector energy efficiency and climate action. Their materials include detailed analyses of how operators achieve emissions reductions and improve network efficiency. The organisation also maintains resources on mobile technology’s environmental impact and industry-wide sustainability initiatives.

Ofcom, the UK communications regulator, provides information on telecommunications infrastructure deployment and network performance. While Ofcom’s primary focus is regulation rather than sustainability, their reports on network coverage and technology adoption offer context for understanding infrastructure changes in the UK market.

The Department for Energy Security and Net Zero publishes policy documents and statistics on energy consumption across sectors, including information and communication technologies. These resources help place telecommunications energy use in the broader context of UK energy policy and decarbonisation efforts.

For businesses seeking guidance on supply chain emissions reporting and carbon reduction planning, the UK government’s Procurement Policy Note 06/21 sets out requirements for suppliers to central government. Understanding these requirements helps businesses assess what environmental information they may need from telecommunications providers and other suppliers.

Companies looking to develop their own energy efficiency programmes can find sector-specific guidance through industry bodies and professional organisations. The Institute of Environmental Management and Assessment offers resources on environmental performance measurement and reporting that apply across industries, including approaches to tracking energy intensity and setting reduction targets.