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Putting green in the bank

Putting green in the bank

Optimal Prime

Although there is little quantitative data to reference, the consultative or advisory side of green IT is an opportunity in Australia with legislative obligations already in place and more on the horizon, IDC associate research director for green IT and services, Philip Carter, said.

“We haven’t tracked any numbers along those lines in terms of how much people are making,” Carter said. “It is something that we are looking at and asking, but the vendors themselves aren’t breaking it out as a separate line item. From a qualitative perspective the big money at the moment is around infrastructure optimisation and then reducing electricity consumption as a result of that.”

Datacentre assessments and follow on services projects when firms are able to offer hardware and software products are where revenue is found, according to Carter.

“At a large scale that is where we see the money being made,” he said. “For the big vendors such as IBM and HP it’s all about infrastructure optimisation, infrastructure management and they tag the need to reduce electricity consumption on top of that; this is where the revenue is being made.”

In fact, ongoing power management is one area that many industry leaders highlight as an opportunity. Fujitsu, for example, includes power management as one of its four key green IT tenets – the others are cleaning up operations, optimising infrastructure and procurement.

“We look at the actual sources of energy as a start,” Fujitsu’s O’Flynn said. “Is there a combination of green power or is there an option to have some renewable energy sources?”

While conceding Australia was not at a practical level yet with green power, she contended it was on the horizon and that with further developments using green power would not be overly costly.

“I don’t think we are far away from that being a cost neutral situation if we look at 2010 and carbon trading with the expected increases in electricity cost,” she said. “There will be a point where that is beneficial to have green power as part of the strategy.

“I think that is where the gap in the market is. The last 12 months in Australia has been around education and breaking the myths. We are starting to see a real intent by organisations to look at green IT not as an additional cost but as a driver for business. I still think we are a while away from people grappling with the fact that this is a real opportunity to create credit. I have worked with some companies that do that, but they are the few rather than the majority.”

Transformer

With the impending introduction of an emission trading scheme (ETS), companies will be forced to factor in the cost of carbon. For EDS green practice leader, Sundeep Khisty, this is clearly a business issue and places green IT at the forefront of planning.

“Certain companies are but mostly the government agencies are taking the lead to understand their liability or their carbon footprint,” he said. “In terms of repeat business I am more interested in ongoing carbon management.”

The first point of focus for companies should be to conduct an assessment so they know their baseline emissions and are able to introduce governance measures prior to the start of the ETS, Khisty said. And as most companies are ill-equipped to conduct this kind of operation, it provides an opportunity for service providers.

“It has multi benefits and one needs to re-paint the business case evaluation criteria,” he said. “Once the carbon cap and trade system comes you will have a cost to your carbon.

“At the moment it is not in the focus, it will come into focus once the ETS comes into place. National Greenhouse and Energy Reporting (NGER) compliance has already kicked off so from a CIO perspective it is now. They cannot ignore energy costs, they can’t ignore the compliance obligations and because of the cost of carbon it will impact the P&L; the bottom line.”

To be sure, green IT is a business issue and there should be a return on investment whenever you are looking to develop environmentally sustainable policies and practices.

“We have to be very pragmatic that we have to show savings,” Khisty said. “At the moment electricity is an indirect or hidden item. Once you go through having a focus on the electricity line item or cost you will find more opportunity for operational innovation.

“Of course, you are going to do continuous improvements and engineering but specifically focused on operational innovation which looks at using the best of the technology and leapfrogging to an environment which is more efficient, otherwise you are leaving money on the table.”


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