After recently attending and presenting a paper at a conference around Green IT, it became overwhelmingly clear that all speakers were providing the same message and that the message by most delegates, was probably going to be ignored. I do think delegates were genuinely interested, but in these tough financial times, a clearly articulated compelling reason to act was lacking. Our top 10 reasons why business should act within South Africa are spelled out below. Although South African specific, most are appropriate in any economy and all can be positively impacted by adopting a green IT strategy.
#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 few 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. In 2015 this trend has continued unabated. Since 2007 energy rates have increased threefold and will just keep rising. Conservation of energy is key, for financial and grid stability as well as 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, 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 Demand Side Management
To overcome our energy issues Eskom has adopted two approaches. Firstly to build 2 new power stations, Medupi and Kusile. These builds have been fraught with problems and delays but Medupi is starting to produce some base load power now. The second strategy is aimed at lowering the base load required through energy efficiency initiatives, some of which Eskom pays incentives for, or at the very least used to. Reducing energy and hence demand is important for all of us in keeping the lights on.
#5 A new global climate deal
In December 2015 In Paris it is all indications point to the fact that we will have a new climate deal with clearly defined reduction targets and ultimately a carbon pricing mechanism. This train has already left the station and a future constrained by carbon is inevitable.
#6 International trade tariffs
It is largely expected that international trade tariffs will be adopted some time 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. 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.
The flip side of this is the introduction of a carbon tax in South Africa at a rate of R120 per tonne. This will be implemented in 2016 in South Africa and brings opportunities and threats to big business.
#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!