Energy Star comes to data centres

On the subject of standards (see the last post), PC World in the US has reported that the US Environmental Protection Agency (EPA) is nearing completion of the work on an Energy Star program for data centres.

When it’s done, data centres will be able to use an online tool that ranks their efficiency on a scale of 1 to 100. Those that score 75 or higher can request an audit from the EPA, which can then award the Energy Star certification.

This is not an entirely new process for the EPA, which already rates the energy efficiency of 18 types of buildings, including offices and hospitals.  Data centres are somewhat different, though, and the certification process is seen as more incentive-based, i.e. the EPA hopes companies will see an Energy Star rating as a potential marketing tool.

Measurement will be based largely on the widely used PUE (power unit efficiency) from the Green Grid, which measures the total power supplied to a data centre divided by the amount that actually reaches IT equipment.  There are, apparently, some issues about other factors that are not included, but the EPA seems to be open to amendments to the assessment, if required.

It will be interesting to see how this pans out.  As I said in the previous post, green IT standards that are widely accepted and applied are a good thing, particularly if there is no legislation in place.  Energy Star is quite late to the table in this case, though, with the Green Grid already offering lots of advice around data centres and there is also an EU Code of Conduct for Data Centres.  It really depends on whether other organisations defer to the EPA certification.  Given that Energy Star has been widely adopted both in the US and Europe, it has a good chance of broad acceptance as a data centre assessment.

Andrew Fanara, who leads the program at the EPA, is quoted in the PCWorld article as saying that avoiding a patchwork of regional programs is important, especially for multinational companies.  I couldn’t agree more.

The EPA hopes to launch the Energy Star certification for data centres in June.

EPEAT takes Singapore

Singapore has become the 41st country to join the EPEAT (Electronic Product Environmental Assessment Tool) scheme and the first since the major geographic expansion last year. 

In December EPEAT approved a process whereby purchasers, manufacturers or other stakeholders can nominate countries for addition to the registry.  Approval for inclusion in the scheme depends on purchaser and supplier interest, government support or other factors, but there’s a bias in favour of additions. 

This was apparently the first time the process was used for adding a country.  “Growing interest in environmental issues and greener products among end users made Singapore a strong candidate for addition to the EPEAT system’s country coverage,” said Jeff Omelchuck, Executive Director of EPEAT.

Toshiba has been quick off the mark in registering the first EPEAT Gold-rated products in Singapore. In fact the company has apparently registered 23 Gold-rated notebooks.

It’s reassuring to see the continued geographic expansion of EPEAT.  The industry needs these sorts of de-facto green standards and the growing global acceptance provides increasing legitimacy.  Mind you, it’s also good to have some other views, such as the Greenpeace Electronics Guide, to help push the boundaries in particular areas and prevent any complacency.

Carbon Emissions Management – IT solution vs management consultants

Ernst & Young has published a report entitled ‘Carbon Market Readiness’ looking at the implications for accounting, compliance, reporting and tax considerations of US state and national carbon
emissions programs.  The report is here – it’s US-focussed but applicable pretty much world wide.

One point to note is that whilst there is no national legislation in the US, the report shows the extent of local (although often voluntary) programs that include some emissions counting and reporting requirement, as the map below shows. 

 

 

Anyway, the report concludes that US lawmakers are focused on carbon emissions management - new mandatory GHG reporting requirements from the EPA took effect on 1 January 2010 and further legislation is expected.  “To stay ahead of the curve, companies need to make sure they have fully embedded carbon considerations in their business strategy to ensure that climate change issues are properly addressed. This includes their risk management operations, day-to-day business, accounting and tax planning.”  It goes further: “It is also important to incorporate public perception of GHG emissions into the overall business plan and properly report emissions from a tax and financial disclosure perspective”.

The report points out that these changes should be looked at not just as a cost but also a potential opportunity.  Carbon reduction projects can generate a positive return on investment and new product or service lines can create new sources of revenue, for instance in capturing, storing, and selling of emissions themselves and/or trading emissions credits.

Ernst & Young is clearly keen to work with its clients in taking the appropriate action, but in terms of ‘straightforward’ carbon accounting much, probably most, will be done through online solutions.  Carbon Emissions Management Software (CEMS) can be very sophisticated and by keeping the ability in-house provides significant flexibility, as well as, in most cases, a lower cost.  Nevertheless, legislation, accounting and other issues, will become increasingly complex, particularly for international companies – fertile ground for management and tax consultants.

Copenhagen update

Well it seems that 55 developed countries have now registered their planned emissions cuts by 2020, as agreed at Copenhagen, although it’s not always clear cut.  The deadline was the end of January, but the UN says the deadline is ‘flexible’.

Here’s some of the country targets (as compiled by Reuters based on the available information at the time of the original deadline):

• US – aims to cut emissions by 17% on 2005 levels by 2050, equivalent to 4% below 1990 levels. The reduction will be helped by President Obama’s promise that the US government would cut its own emissions by 28% by 2020 (compared with 2008).  On the other hand, the US budget, released on Monday, apparently no longer mentions any revenue from the proposed cap and trade scheme, part of the US climate change legislation proposals.

• China – Will try to cut carbon per unit of economic output by 40-45% below projected levels by 2020 from 2005.  So this is not an absolute cut, but slower growth than the economy would dictate.

• India – 20-25% on 2005 by 2020.

• EU – Kept with the less ambitious figure of 20% below 1990 level by 2020.  Would go up to 30% if other countries promised stiffer targets, but there is also internal pressure not to promise targets that would make industry uncompetitive.

• Japan – 25% below 1990 by 2020, but conditional on other ambitious deals.

• Australia – 5-25% below 2000 levels by 2020.  5% is the starting point and any more is dependent on other countries’ targets.

 

Progress, but pretty depressing really.  It reflects the Copenhagen failing in that many countries are reluctant to set ambitious targets unless others do – Copenhagen was meant to set the global target level.

Supply chain emissions assessments – getting broader, but not very deep.

The CDP has released its Supply Chain Report for 2010 – the full report is here. 

The CDP Supply Chain Program involves a group of global corporations who have extended their climate change and carbon management strategies to their suppliers via the CDP’s annual information request.  This year, 44 companies (Members) asked 1402 of their suppliers for information and 710 (51%) responded, 95 (7%) declined and 597 (42%) did not respond.  The report is based on the key findings extracted from the information requests.

The information revealed that Member companies face significant challenges in addressing their supply chains.  Only a small number of companies have extensive knowledge of the availability of suitable green products and most Members don’t currently have the tools they need to track their suppliers’ climate change performance.

However, the report finds that 89% of Members already have a strategy in place to engage with Suppliers on GHG emissions and the importance of carbon versus classic procurement targets is expected to triple during the next five years.  It will become common for Members to adjust their supply base according to low carbon criteria - 56% of Members expect that in the future they will deselect suppliers for failing to meet formal carbon management criteria, compared to just 6% today.

It’s clear that suppliers will need to perform detailed carbon emissions assessments and will also need to set ambitious targets for reducing their emissions in order to remain competitive.

Suppliers were assessed across four dimensions of carbon management:

• Strategic risk awareness - A large part of the supply base (58%) feels exposed to regulatory developments, with general emissions regulations (57%) and cap-and-trade schemes (38%)most commonly identified.  Extreme weather events threaten almost 70% of suppliers, while changes in temperature and rainfall patterns threaten almost a half, with flooding and rising sea levels not far behind (46%).

• Carbon reduction ambition - Only 38% of suppliers have carbon reduction targets in place and their current commitment lasts an average of just five years.  In fact, 81% of suppliers do not set targets beyond 2012.

• Reporting capabilities - Suppliers do display an increased willingness to disclose emissions information; 62% currently report Scope 1 emissions and 63% report Scope 2.  But there is a lack of information around Scope 3 emissions - the percentage of suppliers who report supply chain emissions (i.e. suppliers’ suppliers’) drops to just 8%.

• Implementation practices - The most commonly used approaches for implementing emission reduction plans are energy efficiency increases, process improvements and renewable energy use.  It’s now also an important topic at board level - 60% of companies have elected a top-level executive with carbon reduction responsibilities.  Unfortunately, though, only a third have a strategy in place to engage with their own suppliers on this topic.

 

It’s an interesting report in that it highlights the progress being made in bringing the supply chain into the emissions calculations, but it also shows how far there is to go.  Once you get past immediate suppliers the effort disappears fast.  Only a third are looking at the performance of their own suppliers and less than 10% are reporting their supply chain emissions.

It’s an area that will become increasingly under focus, not least because of stakeholder pressure, which the CDP represents.  There will be an increasing need for information flow up and down the supply chain (good business for solutions providers), and pressure on all suppliers (including ICT) to perform.

Global e-waste expands but recycling/recovery improves

A market study by ABI Research, “e-Waste Recovery and Recycling,” points out the dichotomy that e-waste represents.  If handled badly it constitutes a threat to the world's ecosystem through contamination to the soil, air and water, while also exposing people to a multitude of health hazards.  If treated properly, much e-waste can be reclaimed or recycled for future use and converted into a significant new revenue stream.

ABI forecasts that the worldwide market for e-waste recovery, i.e. the money generated through reclamation of materials from e-scrap, will grow from $5.7bn in 2009 to nearly $14.7bn by the end of 2014, a CAGR of 20.8%.

Market drivers include the increasing collection and recycling rates, better/more cost-effective recycling technologies and improved recycling infrastructure and legal framework worldwide as well as significant growth in electronics markets globally, particularly in developing economies.

Whilst the economic downturn, which impacted commodity prices and demand for recycled materials, shook the market, economic recovery combined with strengthening e-waste recycling legislation is expected to drive improved recycling/recovery in the next five years.  The legal framework for e-waste recycling remains strongest in Europe, thanks to the WEEE directive, other non-profit groups such as the Basel Action Network (BAN) and e-Stewards Initiative are driving improvements in many other regions of the world, especially the US.

E-waste is an interesting case study on the pressures on all companies to become more environmentally friendly.  Pressure from lobby groups and stakeholders for better disposal initially raised awareness and created some action.  Better technology became focused on the reclamation part, meaning that there is money to be made from doing it properly, which helps tidy up the market.  But in the end it’s legislation that has to force the issue, particularly for the times when the economics simply don’t work.  It’s much the same path for reducing carbon emissions.

Is virtualisation running out of steam?

US technology provider CDW published a survey-based report earlier this month looking at the virtualisation market – maturity, differences by company size, value, barriers to implementation, etc.  The full report is here.

The first point to emerge is that server virtualisation is maturing – more than 90% of businesses that responded had implemented it at some level and more than half said they had completed their deployment.  But this seems to have been very much focused on the easy wins - even organisations reporting that they have ‘fully deployed’ server virtualisation said that just 37% of their industry-standard server infrastructure consists of virtual servers.

There were a number of reasons why they had stopped there.  The most-cited barriers were security concerns (17%) and the compatibility of current hardware (17%) or critical software applications (11%), as well as the uncertainty of a return on investment (12%).

On the other hand, only 11% of businesses that have fully implemented virtualisation voiced concern with security, although the figure was 22% for businesses that have not implemented it fully, suggesting that security was an issue in further deployment.  Overall, though, 95% of businesses that have implemented virtualisation believe they are saving significant money as a result, and almost as many (94%) are measuring their success in terms of IT productivity, business agility and reductions in IT energy consumption.

The main drivers to adopting virtualisation in the first place are shown in the chart below.  It’s not surprising that ‘Green IT initiatives’ is not top of the list, but nevertheless a mention by 57% of respondents is encouraging.

 

It will be interesting to see what happens next.  If this survey is correct then we’re nearing the end of this phase of the adoption of virtualisation in medium/large companies.  The easy stuff has been done and there are disincentives to taking it further at the moment.

But there will inevitably be further adoption over time as the barriers are pushed over.  If no security issues emerge then companies will take it further, for example.  Probably more likely, issues of cost, energy use, emissions management, legislation, etc. will put further pressure on data centres who will be obliged to take virtualisation further.