Personal Computer (PC) Power Management solutions have proved their mettle in providing unrivalled and hard-to-overlook energy and cost benefits internationally, but South African companies are still struggling to come to terms with the simple concept of powering down PC’s in a safe and automated fashion. 

Tim James, CEO of green IT consultancy sustainableIT says the proliferation of sustainable IT practices are becoming more apparent and getting more focus on the CIO’s agenda, however tangible action needs to happen in this untapped area for energy efficiency in the enterprise.

He says IT administrators in many organisations continue to insist that PC’s should remain on 24 hours a day to allow for out of hours management such as patching updates and virus scans.

“The reality is that this is an inefficient way of delivering the IT service, both in terms of cost and energy Power management tooling exists which allows companies to automate power downs and power ups of infrastructure, ensuring cost savings as well as facilitating IT department’s requirements.” 

The findings of a recent PC Energy Report commissioned by 1E and the Alliance to Save Energy, indicated that despite spiralling energy costs globally and the environment playing an increasing role in the corporate agenda, much further action is required by both individuals and employers.

Key statistics show that the environment is the main reason why 27% of UK workers power down their computers at the end of the workday compared to only 10% who cited this reason in the US.

If the 17 million workers in the UK who regularly use a computer turned it off at night, it would reduce carbon dioxide emissions by approx 1.3 million tons, the equivalent of removing 245 000 cars from the road.

James that although the research was conducted in Germany, the UK and US, the findings have as much relevance, if not more so, within the South African context. “We are still in the midst of an energy crisis and we interact with organisations on a daily basis that are leaving PCs in an idle state overnight. In some organizations we are seeing in excess of 95% of machines being left on overnight.  We are certainly less aware of our environmental impacts than UK-based employees and would have a similar profile to the report’s findings on US employees,” he says.

The report indicated that if all of the worlds 1 Billion PC’s were powered down overnight, the energy saving would be enough to power the Empire State Building in New York, inside and out for 30 years.  Put another way, the same saving in energy would power the entire South African grid for 2 days.

The simple step of powering down a PC can reduce a machine’s energy use by 80%, allowing companies to save more than R260 per desktop PC per annum.

“Powering down inactive PCs can provide a simple yet effective way for businesses to reduce overhead costs and environmental impact,” says Kateri Callahan, president of the Alliance to Save Energy.

“The economic crisis and volatile energy prices make it even more imperative for businesses to save money by saving energy.”

A computer uses energy even when it appears to be idle. Shutting down PCs when not in use will help businesses to significantly reduce costs while preventing tons of CO2 from being emitted into our atmosphere.

“Although much focus has been placed on data centre efficiency, according to Gartner, the majority of energy is consumed in PC’s and monitors from an ICT perspective.  Organisations simply must adopt tooling to power this infrastructure down”, James concludes.

Conventional wisdom in the IT industry rightly dictates that you should never turn off a server, just in case it fails to come back on again when you need it. However, power management specialists 1E are now exploring whether it may be possible to automatically turn off underused or unused servers, slashing energy use and carbon emissions in the process.

1E, represented in South Africa by green IT pioneers sustainableIT, made its name with its NightWatchman PC power management system, which allows companies to automatically turn off PCs that would have been left on overnight without losing any of the users’ work.  The company is now adapting this approach to the datacentre and have launched the second version of its NightWatchman Server Edition with key functionality of the product being to identify both physical and virtual servers that are not performing ‘Useful Work’, a term 1E have trademarked.

“Modern servers have power management systems but IT managers are either unaware of them or reluctant to turn them on,” explains Andy Hawkins, product manager at 1E. “Our software analyses whether a server is doing useful work and can then activate the power management system and throttle back the CPU or fan speed where it is not needed to do useful work.”

“In many IT organisations, it is true that they often don’t know what many of their servers are doing”, explains sustainableIT director Tim James. I have had a number of companies tell me that they have resorted to switching off ‘old’ servers to see if anyone complains, hardly best practice!”, James elaborates. In fact 1E’s research has found that typically 15% of servers are doing nothing and can be powered down immediately.

NightWatchman Server Edition raises the bar in terms of understanding whether a machine is busy, concentrating on the underlying ‘processes’ rather than the ‘processor’, which is the source of performance for traditional tools.  “The operating system alone uses between 50 and 60% of the processing capacity of a server”, say James.  “Unless you can achieve a greater understanding of what is running on it you have no means of making informed decisions around virtualisation, consolidation and decommissioning”, he explains.

NightWatchman Server Edition applies to both the physical and virtual servers to identify all known un-productive work and then reports on what is left. The software can identify a range of processes and activities, including CPU, disk, networking, etc. that enable it to establish what’s going on and what might be needed. If it is just running anti-virus scans, patches or doing backups, then it is not actually doing anything productive from a business perspective.

With the emergence of the “virtual world” and the ease of provisioning virtual infrastructure, unused servers are becoming more common place and the concept of ‘virtual sprawl’ is starting to take root. Hawkins explains that the latest version of the company’s software marks a stepping stone towards providing companies with the ability to track how much energy is used by each virtual machine and identify servers where the amount of energy being used can be reduced.  Virtual sprawl can be managed and eliminated by measuring the ‘useful work’ that servers are doing.

1E estimates that simply applying power management or ‘drowsy server’, another 1E function to servers can cut energy use by an average of 12 per cent, with further savings realised by commensurate cuts in the energy needed to cool the datacentre.  “There is a mindset where people are reluctant to apply power management in the datacentre,” Hawkins says. “We need to make people aware that this technology has been around for a little while and that the benefits are significant.”

 “Power management in the datacentre cannot be ignored with escalating energy rates and increased stress on power capacity in physical locations. Datacentre and facilities managers need to maximise savings and improve the way that capacity is planned and provisioned”, James concludes.

Global Industry Analysts recently released a report on the global Green IT Services market indicating that Green IT services are expected to reach US$5.01 billion by 2015. This projected growth in the market will be primarily driven by factors such as greater focus on data center optimization, widespread adoption of Green IT initiatives beyond the data center, as well as the development and implementation of new green management software technologies, amongst others.

Growth in the Green IT services market has traditionally been focused on achieving data center energy efficiency. Initially driven by regulatory pressures and increasing costs, data center efficiency has been the starting point and the focus area of many green IT initiatives worldwide. With compelling economic and environmental benefits seeping in however, data centers are being ‘painted green’ under the banner of environmental sustainability, which is rapidly emerging into a business friendly and marketable concept. With the downward pressure exerted on businesses to become energy efficient, data centers have witnessed a slew of green deployments in the recent past such as virtualisation and HVAV optimisation. In the upcoming years, green IT initiatives are poised to spread beyond the data center to other areas within the enterprise i.e. distributed computing, networking, mobile, supply chain, manufacturing, and other operational processes.

Local company sustainableIT is specifically referenced in the report as a key player in the global market, alongside the likes of Accenture, BT Global Services, Deloitte, HP, IBM, Dell, CSC and Tata, amongst others. “As pioneers in this space, it is nice to get some recognition from industry analysts around the work we are doing in this segment”, explains local sustainableIT CEO, Tim James.

James agrees with the findings of the report that the segment is starting to move beyond the data centre from a services perspective.  “More and more companies are starting to engage us on their end to end strategy around IT sustainability”, he explains.  “The delivery of ICT services can no longer focus purely on processing capacity and performance.  Energy efficiency, environmental scorecards and financial return on investment are all key in the low carbon economy that we are moving towards”, James concludes.

The report titled “Green It Services: A Global Strategic Business Report” published by Global Industry Analysts, provides a review of industry, technology overview, technology introductions, and profiles of major players, including sustainableIT and provides and analyses world market data in this segment.

Commuting, long considered a drain on time and productivity, now has another drawback – its considerable impact on companies’ carbon emissions footprint. Businesses today have to understand where they are in terms of carbon emissions and plan some quick and easy gains to get on the roadmap, says Puleng director, Steve James.

According to sustainableIT director, Teresa Legg, the first step was a workshop in which the Puleng team was briefed on the parameters and methods of the audit. “In a sense, it’s explaining the whole process of doing the carbon inventory assessment, so we both understand where emissions are coming from, can establish the boundaries of the audit, and also workshop what they want to calculate,” explains Legg.

James notes it’s helpful to understand what has a direct impact on emissions, and potential outside influences. “During the positioning workshop, we realised it goes far beyond just the data centre. It’s great to understand what is happening globally, as well as from a South African governance perspective, and then relating it back to IT and other activities in the company.

“We embarked on the process to examine, as a small business, what we’re doing right, what we’re doing wrong, and how we can plan going forward.” A lot of people don’t understand the GHG Protocol and the different scopes and guidelines,” says Legg, adding this is something outlined in detail during the workshop.

Scope two describes emissions a company has created through the procurement of electricity; which is provided by another party (Eskom). Scope three emissions are those created by a company whose product or service you’re using. “So, if you hire a vehicle owned by another business, that would be their Scope one emission, but your Scope three,” notes Legg. It also includes air travel, paper usage and employee commuting.

“Under the GHG Protocol, you are not obliged to report Scope three, but we recommend it if these emissions make up a material component of the company, such as if it outsources its transport.” Commuting is considered Scope three because the vehicles themselves don’t belong to the company, but their emissions are produced in the process of employees getting to work. James says Puleng opted to report some Scope three emissions because, as a services-based business, much of its work involves staff travelling to clients in a technical support role.

“The emissions from commuting can be enormous, and made up a significant portion of Puleng’s total footprint,” Legg points out.

While much of the audit data needed was easily available in financial documents, sustainableIT set up an online survey for employees to report on their driving habits, including how they get to work, how many people travel with them, how many kilometres they drive and how frequently.

Legg notes they encouraged as many workers as possible to reply, to get the most representative sample. With 53% responding, sustainableIT took the travel patterns of this group and extrapolated it across the organisation, coordinating the online survey with the other information to calculate the final figures. These covered emissions generated during the 2009 financial year.

In calculating the final measurements, Legg explains the GHG Protocol standardises all greenhouse gases (including methane, nitrous oxide and so on) to reflect their warming equivalent to CO2. This allows the evaluation of various gases against a common basis. “Their Scope three emissions made up 75% of total emissions, and commuter travel 69% of their total including Scope one, two and three,” notes Legg. She adds that organisations are often reluctant to calculate Scope three for this very reason. “In services-based organisations, commuter travel can be quite high.”

James notes that Puleng, as a services-oriented business, has a lot of support contracts, with approximately 66% of its 50-odd staff complement constantly driving to clients. “We did one million kilometres and we’re a small business, so you can imagine what bigger companies are doing. It was a real eye-opener.”

In addition to its Johannesburg site, Puleng also has a Cape Town office, with commuting taking place between the two via air travel. “With hindsight, and foresight, it’s something we really have to be conscious of because it has massive implications,” states James.

Legg says recommendations included teleworking and using video conferencing and voice over IP communication where possible. “There’s a huge opportunity, especially for IT organisations, to reduce commuting through teleworking.”

James notes that Puleng has brought in teleconferencing solutions such as Skype and WebEx. “With voice over IP solutions, it’s not just employee-to-employer communication anymore, it’s employee-to-customer, at a fraction of the cost.” The company has also introduced off-site support for customers, via a service-desk support team, which James says has a massive bearing on reducing mileage.

He adds that utilising the same technologies it offers to clients, such as virtualisation and automation, in its own business, has enabled Puleng to make significant energy savings. “We’ve taken server infrastructure from 15 machines to one through virtualisation and added redundancy and backup. If you compare our old server room to the one running now, it’s like chalk and cheese.

“There are always areas for improvement, and we can be slicker around getting cars off the road,” says James. He points out the audit has provided more visibility into how the business is run. “One thing that has come out of this is a budget for air travel. It’s something we have to do, but there’s a budget for it now, which we never had before.”

For anyone embarking on a green journey, the first step always has to be measuring, says Legg. She stresses that establishing a baseline is vital, in order for subsequent reports to show where there has been emissions growth or reductions. “It’s also helpful to consider other metrics, such as emissions per employee, or per square metre, to compare organisations of different sizes.”

She says they recommended that Puleng sets targets and holds all of the initial data, so in a year’s time when it re-looks at things it knows exactly what metrics were used and can see what’s changed from the baseline. “It’s key that organisations start measuring now if they want to reduce emissions, because at some stage they’ll have to report on this. Unless they actually have a baseline and are measuring against it, there’s no way to manage emissions or measure how they’ve changed.

“Many companies are daunted, but it’s not rocket science. In most cases, the data is there already, and with a bit of guidance it can be easily accessed and translated,” she explains.

James says Puleng plans to do the audit again next year, as “it’s all good and well you get business owners to take ownership, but if you don’t follow through and measure progress, you might as well not have done it in the first place”.

He adds that banks and financial institutions are showing thought leadership on these issues and beginning to consider it in tenders and proposals. “They’ve come out with an approach of ‘how green are you? If you have a strong carbon audit and very strong BEE credentials, it shows you are a business which demonstrates social responsibility; not only in terms of the people you employ, but towards the environment we’re trying to save.”

James advises other businesses to conduct an emissions assessment because the exercise is pretty painless and you can’t manage what don’t quantify. “In this day and age, you have to understand where you are in terms of carbon emissions and plan some quick and easy gains to get on the roadmap.

“It doesn’t have to involve years of workshops and planning; many companies are already running the right solutions and just need to accelerate them. Virtualisation, for example, is one way of making substantial energy savings, power management is another.

‘”People have to get on with it, because it will be mandated soon. Understand where you are today, plan some quick gains, which is easy with the right technology, and underneath it implement a real, underlying, strategic roadmap for sustainability.”

Green IT may be on everyone’s lips, but it’s not yet made it onto their `To do’ lists.

 Green IT has been one of the hot topics for at least the past three years in South Africa, and several years more than that in Europe.

Yet no one seems to be doing green. Anecdotal evidence from interviewees seems to back this up. As HP country manager, Enterprise Servers, Storage and Networking, Manoj Bhoola notes: “We’re not aware of any companies that can claim and put their name behind the fact that they are fully green in their IT organisations. A lot of companies have done a lot of work but I don’t think anyone has reached the end goal.”

Some haven’t even started yet. Says Sustainable IT head Tim James: “I think it’s going to be legislation around carbon emissions that will make people start doing it. No one is going to get points for doing it when they don’t have to, but some companies have realised the marketing opportunity and cost saving potential now and will do it. Then there’s the energy aspect. This is where we see people starting to pay attention. A new electricity price hike has been announced and we’re going to see people get serious because of it, especially guys with big bills. It has be a business thing, it can’t just be an IT thing.”

That really is the point. As BCX CTO Andy Brauer states: “The problem is it’s a whole way of life and philosophy that has to become part of the value chain in order to be meaningful. It’s very difficult for emerging countries, which are largely coal-based, to have a green view. Yes, they are contributing – but is it as much as volcanoes? Or the US, which has some 200 million cars driving around every day?”

A matter of perspective

Africa as a whole contributes less than four percent of global greenhouse gas emissions*. South Africa contributes 65 percent of Africa’s* and 1.5 percent of the world’s* carbon dioxide emissions. According to Gartner**, the ICT industry is responsible for roughly two percent of global carbon dioxide emissions.

“And how responsible is IT really for carbon emissions?” Brauer asks. “In the process of making it yes, but using it? When there’s no electricity, everyone’s diesel generators kick in, which is counter-active to green, for example.”

Brauer’s point is possibly more to do with people thinking about these things versus blindly accepting what’s published by press and analysts as ‘the truth’.

Conversely, or perhaps ironically, as BT country manager Keith Matthews points out: “IT and telecoms organisations have been leading the way in showing how environmental and commercial needs can be aligned. One of the reasons this sector has led the way is that they found they can calculate their carbon impact with relative ease, since most of their emissions come from running their networks.”

Cost calculations

Driving green initiatives of late, and particularly in South Africa where power has been unreliable since early 2008, is the cost factor. Says Matthews: “In a world of high oil prices, it makes hard-nosed financial sense to reduce energy usage. Governments and pressure groups will not let companies or consumers forget their responsibility for protecting the environment, while also seeking financial gain. The winners in the next economic upturn will be those corporations that embraced sustainability as a framework to drive financial success during the downturn.

“People and companies who think sustainability is merely a fair weather exercise have been missing the point all along. When times are tough, the onus on every business is to save money, protect and build revenues and make sure core business assets are being fully utilised. Running your business in a sustainable way can be a key driver when it comes to meeting your goals – not just when times are tough, but actually because they are tough.

“Just because times are tough doesn’t mean customers have altered their behaviour,” he adds.

There’s more to going green than just reducing energy usage, however. Says Citrix country manager Nick Keene: “Recycling of ageing IT equipment, procurement from green suppliers, and so on, the entire strategy has not been embarked on totally, but selectively around the need to save money and reduce power consumption because there’s no power to be had. There’s a lot to be done and South Africa’s commitment recently (to reduce carbon emissions by 34 percent by 2020***) will start putting pressure on organisations to do so.

“The only way to achieve that is by starting to put the necessary procedures and policies in place.”

And while no one is being penalised yet, fines could be put in place faster than some organisations would like to think. “One of the biggest things that is likely to come out of the UN Climate Change Conference (when the climate treaty gets signed in Mexico at the end of year) is trade tariffs against carbon intensity of goods, i.e. a fine is likely to be added to the cost of high carbon-intensive goods. Businesses here will be penalised.”

A recently released report by the South African Institute of Chartered Accountants (SAICA) says that local climate change laws could be implemented by 2012.

And King III is already in effect. It says that: “IT governance should focus on four key areas: Strategic alignment with the business and collaborative solutions, including the focus on sustainability and the implementation of ‘green IT’ principles; Value delivery: concentrating on optimising expenditure and proving the value of IT; Risk management: addressing the safeguarding of IT assets, disaster recovery and continuity of operations; Resource management: optimising knowledge and IT infrastructure.”

Means and opportunity

Motive, means and opportunity exist for organisations to go green and make a difference to the planet. That the motive for most of them will be cost savings, or even profit, is neither here nor there, despite what some critics says. That it is done is what’s important, particularly as it becomes more expensive not to comply.

Once you understand baseline energy use, you can create a programme of efficiencies for using less energy, says sustainableIT CEO, Tim James.

For local wholesaler Makro, it took a look at the small details to reveal the potential for big efficiency benefits. A comprehensive energy audit of the store’s IT systems showed device management and server virtualisation could offer substantial gains on the green front.

As part of parent company Massmart’s green drive across its operations, Makro SA decided to determine the sustainability of its IT infrastructure, including architecture, equipment, and device disposal.

Pieter Schoeman, Makro SA’s IT and projects director, says it worked with local consultancy sustainableIT to identify changes which could be implemented in its 13 stores countrywide. “Specifically, we looked at the IT infrastructure we could put in place to operate successfully, and what to do to reduce our carbon footprint,” says Schoeman.

Makro supplied sustainableIT with information on its desktops, laptops, printers, point-of-sale (POS) devices, recycling programmes, server use, data warehousing, and utility bills.

“After determining the kind of infrastructure and technology Makro runs in its stores, we engaged in workshops with them to validate the data, and then compiled a report based on the information collected,” explains sustainableIT CEO, Tim James.

He says the whole process took around four to five weeks, after which the firm provided recommendations on how to use technology, and in which areas, for greater efficiency and reduced emissions.

“With these kinds of reports, we focus on big energy consumers and low-hanging fruit, which is mostly in the desktop and distributed environment,” says James.

This included simple changes, such as switching devices off at night. “Sometimes you can’t power down certain machines, but other times they’re left on just for the sake of it.”

But Schoeman adds one has to consider when to switch off equipment. “With POS, it’s sometimes tricky, because you have to run updates on the devices at night – you have to implement things where it makes sense.”

Cost-wise, there were some attractive potential benefits. “There are 720 POS sales lanes in-store and the report showed if we switched them all off at night, we could save R177 000 overall per year. Around 95% of POS can be switched off at night, so we’re looking into this,” says Schoeman. “Half of what was recommended we’re on our way to implementing.”

An area Makro had already tackled to a large extent, according to Schoeman, was the printing environment. “The report showed we’re on the right track, not necessarily by design, but because we already use things like multifunction printers, to fax, print, and copy with one machine.” The company also uses double-sided printing and switches the printers off at night.

“About 90% of the time, people print using the Xerox document centres, which helps get rid of small cartridges floating around and brings savings, not only in terms of maintenance, but by having fewer devices using electricity.”

Keeping track

What you don’t measure you can’t manage.Schoeman adds, however, that Makro doesn’t currently recycle its print cartridges, and is in discussion with Xerox to address this.

“At head office, we’re slowly issuing more people with laptops versus desktops; but in a retail environment, that doesn’t always make good business sense, so we’ll make sure devices are powered down at night.”

Another recent move involved switching over completely to LCD monitors, which Schoeman says use a third less electricity than normal CRT monitors.

He adds that it’s important to follow a replacement and refresh programme, because new equipment is often more efficient. “It doesn’t always pay to sweat your assets; you end up doing the sweating.”

For Schoeman, virtualisation was the biggest opportunity coming out of the exercise. “The report assists with building a business case for adding new technology, such as virtualisation, to reduce electricity consumption and improve redundancy.”

The Green Mile

ITWeb’s new series, The Green Mile, is a monthly feature focusing on an IT-related sustainability strategy. It aims to provide an in-depth, hands-on look at the processes involved in the green journey, and how it progresses from the first step to the final sign-off. Look out for next month’s feature, which explores the intricacies of implementing a green data centre.This includes virtualisation in its central data centre and switching in-store servers off at night. “We’re busy with a proof of concept, which in essence involves taking 10 servers down to two.”

This would provide a group saving of R55 000 per annum, adds Schoeman. “The plan is to implement it at our Woodmead branch and a new store we’re opening in Vanderbijlpark in October. We’ll test out the architecture there, and then start retrofitting in other stores.” He hopes to have virtualisation implemented across all stores by 2011.

Working with outsourcing partners EC Solutions and IBM, Makro could determine the exact energy savings if it reduced its server count, and the resulting saving in CO2 emissions.

“What you don’t measure you can’t manage,” notes James. “You have to understand baseline energy use, and then create a programme of efficiencies for using less energy.”

In terms of sustainability, Schoeman argues it’s also about ensuring processes are sustainable for the business. “The technology we’re considering doesn’t only reduce our carbon footprint, but increases solution efficiency, saving hundreds of thousands of rands and paying for itself.

“The challenge is always to ensure there’s no business disruption during the implementation, because if it impacts customers, it affects sales. You look at what the business can afford and what makes sense, and then start the process slowly and implement it over a number of years.

“But combined savings of around R250 000 make a pretty good business case,” adds Schoeman

He adds that Makro won’t partner with a supplier if it doesn’t embrace sustainability. “Whenever we’re in discussions with a service provider, it’s something we focus on; we want to ensure they’re also going down that route and that it’s top of mind.”

For Schoeman, it’s necessary to review processes on an ongoing basis, refresh in-store equipment to ensure specific standards are met, and continually measure performance to report back to stakeholders on progress. He hopes to do a follow-up review after the Vanderbijlpark store roll-out.

Schoeman adds that managers also share sustainability strategies across the Massmart chains, with a forum review held on a quarterly basis. “There’s a subtle message from Massmart that it expects you to abide by these principles. This will influence Makro’s future decision-making within IT.”

He advises IT managers to start thinking about the possibilities. “There’s lots of low-hanging fruit one can consider – LCD monitors, virtualisation. In my mind you have to start somewhere, but just start. Everything you do makes a difference.

“A lot of people have begun putting plans in place, but if you make an active decision to start, that already puts you on a path to drive and deliver changes.”

The National Energy Regulator of SA (Nersa) announced that power will go up by 24.8% from April, meaning consumers and businesses will have to make drastic changes in the way they consume electricity.Following this year’s increase, prices will go up another 25.1% next year, and 25.9% the year after. The regulator’s approved revenue increases of R85 billion, R109 billion, and R141 billion during the three-year period is below Eskom’s requested hike of 35%. This leaves the utility to look at alternative avenues to help fund its R385 billon power expansion plans. 

While the increases will have a substantial impact on consumers’ and businesses’ pockets, analysts say it’s a necessary price to pay. Jon Adams, CEO of local energy firm The Power Company, says the increases are fair to environmental interests, industries and the general public, and give Eskom something to work with. “If we don’t have these sorts of increases, we’ll have no power in 10 years’ time. We’ve got to have some pain now to prevent a lot of pain later, because without these tariffs there would be no new power stations.”  He adds that Eskom is likely to look to the open market to make up additional funding for its expansion programme, or put in differential tariffs. “It could also introduce punitive tariffs for using electricity when demand is high.” 

 Frost & Sullivan’s energy programme manager, Cornelis van der Waal, says the increases are less than it anticipated and the way Eskom is structured at the moment means it needs all the funding it can get.  “We’re heading into a period where electricity supply is in jeopardy, with potential load-shedding by 2011. It’s going to be very difficult for Eskom to complete its build programme.”  He says the utility could look to raise money in international money markets or approach government to make up the shortfall, although the latter is unlikely to be successful, given the R73.7 billion budget deficit. 

Business Knocks 

Companies will take a hit, says Adams, and many big power users will suffer, “but they have not paid the full price for energy, anyway”, he adds. “A lot of people will look to generating their own power and supplementing electricity, as the payback period is now shorter and these options are much more attractive.”

Van der Waal says the increases come as a wake-up call for firms. “The fact is businesses have been paying very little for electricity in SA. While municipalities increase the base price for consumers, on the industrial side, companies have had a jolly time in the past, and Eskom’s build programme means there will have to be adjustment and rectifying.” He says it’s a positive move that Nersa has spread the hikes over a longer period, and not instated huge increases upfront. “It will be disruptive for companies, and many will have to look at ways of becoming more efficient, especially those heavy energy users running big data centres.“ 

Local consultancy sustainableIT says this year’s price hike takes an average company’s costs from R0.50 per kWh to R0.62 per kWh. “The increases will result in an energy rate in 2012 of R0.97 per kWh for the average company, effectively a 95% increase over three years.” With energy rates set to spiral in future, the company says it’s imperative that organisations look to other avenues to contain costs, with IT being a key element. Intelligent power management of computing environments and the data centre can help achieve aggressive return on investment, it argues. 

Chris Yelland, MD of EE Publishers, says the fact that the rates are significantly lower than Eskom was hoping for will put an end to its monopoly of the energy market. He points out the initial scaling back from consecutive increases of 45% to 35% already required Eskom to cut several generation projects, such as a third coal-fired power station and nuclear plants. “This means even more pressure for Eskom to give up its stranglehold and allow independent power producers (IPPs) to come to the table, as well as for renewable energy to become more attractive.” 

He adds, however, that it will affect consumers, and take a chunk out of disposable income, affecting spending and the economy, as well as hurting industry. 

“SA’s prices were very low for many years, and this will bring it to a more realistic level, while encouraging energy efficiency. It’s a clever price determination that will achieve multirole objectives, encourage the generation of IPPs, and the emergence of renewable technologies.”

Although the climate change conference in Copenhagen failed to achieve its objectives of a binding treaty around carbon emission reductions, sustainable business is here to stay and companies need to gear themselves towards a carbon constrained future. 

In the past couple of weeks, investors representing $13 trillion in assets issued a statement stressing the importance of concluding a legally-binding agreement including a global emission reduction target of between 50 and 85% by 2050.  The same group urged investors, businesses, and governments not to wait for a global treaty before taking action. Actions should be taken now to curb emissions.

In South Africa, due to the lack of binding legislation, measuring and voluntarily reporting on emissions has been left to the remit of companies on the JSE Top 100 as part of the Carbon Disclosure Project, as well as environmentally conscious companies recognising their responsibilities in this respect.  In 2009, 68% of the JSE Top 100 voluntarily disclosed their carbon emissions, ranking only behind Brazil in disclosure response globally.

Mid market businesses are now starting to recognise their social responsibilities in this regard as well and are starting to take action.  TheCarbonReport.com, an offering developed by local company sustainableIT, now allows companies, irrespective of size, to measure and report on emissions through validated processes.  “The solution is geared towards businesses wanting to establish their environmental impact and is the first step towards embracing a sustainable future”, explains Teresa Legg, Director at sustainableIT.  “The cost and complexity of emissions reporting has previously prohibited many businesses from participating in voluntary emissions reporting.  Through the tooling we have developed and our expertise we have been able to dramatically reduce costs to the client.  Every business, no matter how large or small contributes in some way to climate change and more accountability and responsible practice needs to be adopted ”, she elaborates.

Businesses are certainly starting to take action.  Puleng Technologies, a company of fewer than 100 staff has engaged sustainableIT to quantify their carbon footprint. “Although we are a services based company, we still produce emissions with the energy we consume, the paper we use and our travel, both commute and business related.  We recognise that we have an environmental impact and we need to measure it so that we can manage it”, explains Steve James, Director at Puleng.  “It is not just about being green, it is about developing a programme of energy efficiency and cost reductions and TheCarbonReport will provide us with the baseline we will use”, James states.

Aubrey Davies, Managing Director of Cape based ISP, I-Soft Net agrees.  “We are relatively small but measuring our impact has two benefits.  Firstly it allows us to concentrate on areas where we can become more efficient, with a baseline to measure against.  Secondly it allows us to create awareness with our staff which will result in downstream environmental benefits within their sphere of influence”.

With an estimated 900 000 small and medium enterprises in South Africa, the opportunities to reduce emissions within South Africa are exponential.  With energy costs continuing to rise, more businesses are expected to focus on energy and carbon reduction initiatives.  However, companies are encouraged to measure first to ensure that ROI is delivered and benefits are quantified.

 Government’s proposal to cut SA’s greenhouse gas emissions will force businesses to become more energy efficient, with IT leading the way to a low carbon economy.

 This is according to Tim James, founding director of Sustainable IT, who says government’s offer is very achievable, even with the current investment Eskom has in coal-based power.

The Presidency has offered to cut emissions by 34% below expected levels by 2020, and 42% by 2025, as climate negations get under way in Copenhagen. The pledge is conditional to a fair and effective agreement under the UN Framework Convention on Climate Change, as well as financial and technological support from developed countries.

“The offer is a reduction in emissions intensity, rather than a reduction from a stated baseline, which makes it less compelling. But it certainly is a massive help towards achieving a deal in Copenhagen,” says James.

He adds that organisations will need to become more energy efficient, with pricing levels dictating this, irrespective of the target that may or may not be set in Copenhagen.

“Setting aggressive targets for SA business will force a reduction in carbon intensity within manufacture, which will stand SA companies in very good stead in a carbon-competitive future landscape,” says James.

These reduction figures are in line with SA’s Long-Term Mitigation Scenarios, released last year to set a strategic direction for the country’s climate policy.

Angus Rowe and Siegfried Brits, from sustainability solutions provider impactChoice SA, say the reduction targets would bring future emission levels back to almost the current level, at around 450 million tons of CO2 per year. “It seems a very ambitious target, but not impossible to achieve given stringent regulations that need to be put into place,” they add.

“The execution of such an ambitious target will no doubt lead to a cap-and-trade system whereby emissions levels will have to be allocated to economic sectors and companies within these sectors,” add Brits and Rowe.

They explain that allocations under a cap-and-trade system will leave especially large emitters with an allowable cap of emissions, while the surplus will have to be made good by buying carbon credits.

“While burdensome on emitters, this system will facilitate funding and the impetus to grow green projects on a proliferated basis, which in turn will deliver green energy for the future.”

 James points out that energy has been very cheap, particularly for corporate and industrial SA, meaning there was no real incentive to adopt low carbon solutions. “It has to change in future – our very livelihoods depend on it.

“What many fail to realise is that the opportunity for SA is enormous. Because our economy is already energy constrained, embracing and investing in clean tech and clean energy now will give us a massive competitive advantage in the future.”

According to James, ICT has an enormous role to play in moving SA towards a low-carbon economy. “IT allows us to be smart. It allows us to measure, monitor and, ultimately, reduce.

“IT is all about innovation, being efficient and adaptation. The fight against climate change demands this and IT will be at the forefront of much of the new design and innovation that is required.”

Brits and Rowe add that several factors are converging to provide a strong impetus for energy transformation in the country. “Given that the South African targets be ratified in the new global warming treaty at Copenhagen, together with the current and expected future electricity crisis in SA, companies will have no choice but to adapt all of their strategies to incorporate sustainability objectives – else business as usual will be going out of business.”

President Jacob Zuma will head to the climate negotiations next week to meet with heads of state to broker a global climate deal beyond 2012, when the first commitment period of the Kyoto Protocol comes to an end.

As eyes caste forward towards the COP15 Conference, in Copenhagen, on 7 December, more and more questions are being asked about how we transform into a low carbon economy.

Although it is as yet unclear whether any binding climate deal will be struck, the stark truth is that much of the climate science predicts that sub-Saharan Africa is going to be one of the geographies most affected by climate change. Forecasts include significant average increases in temperature, reductions in average rainfall and dramatic climate events when they happen. If any business community should be taking immediate action, it is South Africa’s.

Despite much press around green IT and the benefits of sustainable computing, South African business is not embracing what many see (including Gartner) as the next wave of IT, says Tim James, founding director of niche player, sustainableIT.

The reality is that scant regard is being paid to these benefits. “South African corporates are missing the bandwagon, that their counterparts in the EU and US have been riding for years now,” says James. “Virtualisation has taken off in a big way, although in many cases this has been done for reasons other than ‘green’, namely reducing management complexity, increasing security and improving provisioning and disaster recovery services. Business process adaptation, power management, print management and dematerialisation solutions are not taking hold in the way they have done elsewhere,” he explains.

His view is backed up by Shaun Diamond, director of EcoToo, another consultancy specialising in the area of eco friendly business and IT solutions. “Going green is a journey,” explains Diamond. “Many South African companies do not realise that green IT is not necessarily difficult or expensive, but South African companies have been reluctant to embrace this change in any meaningful way up until now,” explains Diamond.

It is expected that 2010 will usher in winds of change and the potential for South African companies to start embracing a low carbon future. The Copenhagen conference, whether a deal is struck or not, coupled with rising energy rates and impending legislation, should provide the stimulus for change that many expect. “We stand on the cusp of a paradigm shift in the way that we deliver services as IT professionals. Cloud computing, energy and carbon reduction and measurement as well as dematerialisation are the business of the future. Those that embrace this sooner rather than later will be the leaders of tomorrow,” James concludes.

We wait to see what Copenhagen produces, as well as the impact that Eskom increases will have on business truly adopting a low carbon future.