Our top 10 reasons why business should adopt a green IT or sustainable IT strategy are as follows.
#1 We are “dirty”
Due to our reliance on coal, our energy is some of the dirtiest in the world, ranking with Australia as the pariahs of the dirty energy nations. Many often say that we produce less than 2% of global emissions so why should we bother. When we unpack the facts however the situation is quite startling. South Africa produces 1.4% of global emissions which ranks us as the 12 largest producer of emissions globally. The United Kingdom produces 1.5% of emissions yet is three times more industrialized than South Africa. As a developing nation, we have the dirtiest per capita footprint in the world at 11 tonnes per capita, versus China for instance at 8 tonnes. South Africa produces greater than 60% of Africa’s emissions, causing many to label us the United States of Africa. Not much to be proud of here.
#2 Our energy is not going to get any cheaper
The past couple of years have seen some dramatic changes in energy rates. For many years South Africa enjoyed a holiday in respect of cheap rates and abundant energy. This situation changed with dramatic impact in early 2008 when load shedding and rolling blackouts forced all constituents to relook energy provisioning and rates. Rates have gone up in excess of 30% for the past 2 years and will do so for the foreseeable future. Conservation of energy is key, for financial stability and economic prosperity.
#3 Information technology, the energy hog.
IT is often forgotten as a key user of energy, it has become like the plumbing. When we leave the office, our PC screen dims and we think that all is fine. The reality is very different. 1 PC and monitor can use as much energy as 4 or 5 light bulbs. For servers the multiplier is often 10 or more. Gartner, one of the main IT analyst firms estimates that in some organisations, financial services for instance, IT energy can amount to as much as 40% of the total energy bill. This footprint cannot be ignored in energy saving initiatives.
#4 Power Conservation Programme
The much maligned power conservation programme is still hanging over the heads of corporate South Africa like the sword of Damocles. The programme places an energy cap on business based on a baseline calculated between October 2006 and September 2007. Depending on sector organisations we will need to save between 5 and 25% against this baseline or face punitive penalties of up to R18 per kWh. Saving targets for corporate companies are expected to be 20% and the PCP is anticipated for rollout in early 2010.
#5 A new global climate deal
In December 2009, a new global climate deal is expected to be thrashed out in Copenhagen at the COP 15 summit. This unprecedented meeting of minds around climate change will map the process towards carbon neutrality by 2050. The general consensus is that South Africa, along with China and India will be forced into some sort of carbon cap, in line with aggressive targets adopted by developed countries. The net effect is that legislation governing emissions, either through cap and trade or taxation is just around the corner.
#6 International trade tariffs
In line with COP 15, it is largely expected that international trade tariffs will be adopted in the near future that will place a tariff on the carbon intensity of manufactured goods. This needs to be seen in the context of South Africa’s dirty energy and the fact that South Africa ranks 5th on the world list of electricity intensity associated with manufacturing, both of which place us on the back foot in terms of global competitiveness in a carbon constrained world. Organisations need to adapt rapidly, become carbon neutral or positive and ensure that their extended supply chain follows suite, failing which, many will cease to trade.
#7 The monetarisation of carbon
Both the regulated (CDM) and voluntary carbon markets are growing exponentially year on year. In fact the voluntary market doubled between 2007 and 2008. Carbon is now a tradable commodity and is expected to become more so after COP 15 is thrashed out. Any reductions in carbon, assuming the test of ‘additionality’ is passed, create a market opportunity and non-core revenue stream for organisations adopting a low carbon strategy. This potential has largely been untapped in South Africa, due to lack of regulation but is expected to grow rapidly in the next 3 to 5 years.
#8 Consumer consciousness and awareness of climate change is growing
The debate around man made global warming is over and is actually irrelevant in a carbon constrained world. The y-generation is also starting to become economically active and are more concerned about the environment and its preservation than any generation that has gone before. Organisations adopting green as a strategy are starting to make significant inroads against competitors and once the green revolution is complete, the term ‘green’ will be obsolete. If it is not green, it won’t exist, everything will be designed, produced and operate within a green construct.
#9 IT as an enabler
IT is uniquely positioned in an organisation as it usually cuts across all aspects of the business. This means that IT can act as a change agent to reduce emissions through the adoption of technology and providing measurements and reporting. It is estimated that through the application of smart technology, IT can reduce global emissions by 16% by 2020. Smart in this respect means dematerialization, smart logistics, smart building, smart motors and smart grids. By applying technology in innovative ways, business can reduce and manage their emissions.
#10 Adapt or die
We are on the verge of an unprecedented paradigm shift in the business climate, something similar to the dramatic change that occurred at the outset of the industrial revolution which is the cause of the man made climate change we are facing. This paradigm shift, to a low carbon or carbon constrained economy brings both risk and opportunity. The reality is that those organisations that fail to adapt rapidly and timeously will cease to exist in this carbon constrained environment. It is imperative that business leaders are conscious of this changing business climate and adapt their strategies accordingly.
Green IT fundamentally provides an opportunity to lead business down a sustainable path, both within IT and across the business. The reasons for doing so are compelling and action is required. This is not about hugging bunnies and trees, it is about real value that ensures a sustainable future for both business and our environment. Act now!