According to a recent survey, 46 per cent of large UK firms already have a green IT strategy in place.

There are two ways to interpret this statistic. The first is to herald it as evidence that in just a few short years the idea of energy efficient, environmentally-friendly IT equipment has already entered mainstream corporate thinking and that IT departments are taking their green responsibilities seriously and genuinely seeking to cut their carbon footprint.

The alternative is to ask what, exactly, have the other 54 per cent of firms been doing with themselves? Do they like wasting money or is it just that their desire to antagonise environmentalists is so great they do not mind burning cash in order to do so?

The fact is that every company should have a green IT strategy. Or to put it another way, no company should have a specific green IT strategy, on the grounds that as long as they are adhering to best practices and have a competent IT manager then their IT operations should be a pretty deep shade of green already.

The most commonly quoted green IT statistic is that globally the industry is responsible for two per cent of emissions, putting it on a par with the aviation sector. In developed economies, the situation is worse still with UK government figures claiming three per cent of the UK's electricity is consumed by server farms alone.

Meanwhile, as global PC ownership continues to boom and the amount of data stored by companies such as Google and Yahoo grows exponentially the sector's carbon footprint looks set to expand.

And yet, despite this seemingly intractable problem the IT industry is blessed with the fact that it is one of the few sectors where commercial and environmental considerations are almost perfectly aligned in both the short and long-term.

Taking energy as the most obvious example, IT departments should always be looking for the most energy efficient technologies they can lay their hands on. The premiums they have to pay for such systems are pretty minimal and the savings are huge. It might take a renewable energy project developer a decade to claw back their return on their investment, it will take a company buying the most energy efficient servers or PCs they can find less than 18 months.

In this context, the reduction in carbon emissions is a happy by product of thousands, and in some cases millions, of pounds worth of energy savings.

Again, you have to ask what those businesses that fail to consider energy use when making IT purchasing decisions are thinking, particularly given that most servers and PCs are so commoditised that there is little difference between rival models in terms of price and performance. It really is a no-brainer to demand that every piece of kit you buy is amongst the most energy efficient available.

This same alignment of commercial and environmental considerations is evident in almost every aspect of a company's green IT strategy.

Even when you look at the vexed topic of disposing of IT equipment there is a strong business case for taking an environmentally responsible approach, even before you consider the sad reality of PCs being shipped to illegal scrap yards in Africa where workers strip down the machines in dangerous conditions.

According to a new report from industry analyst Gartner, companies can expect to generate a profit margin of between $10 and $50 by selling machines they no longer want to the second hand market, and yet only 44 per cent of PCs are ever re-used.

For companies with fleets of 1,000s PCs that is a sizable revenue stream that is being ignored every time they send their three year old PCs for recycling, or worse still to the dump.

Even if they can't be bothered with the hassle of wiping the data from their machines there are charities such as Computer Aid International that will do the job for them and make sure their PCs find a valuable home in schools and hospitals in Africa, Asia and South America.

And as Computer Aid's chief executive Louise Richards explains there is a sizable environmental advantage to this approach. "As much as 75 per cent of the fossil fuels consumed over the entire life cycle of a PC have already been consumed before a PC is even switched on for the very first time," she says. "So, given the high environmental cost of production, we should be looking to extend the life of our PCs as much as possible."

In addition, when machines do eventually die the fact that resource constraints mean that commodity prices will only rise in the long term means there is a strong commercial case for recycling and reusing as many of the equipment's components and metals as possible.

Ultimately, it is the desire to make this recycling process as cheap and easy as possible that is fueling the industry's drive to engineer out toxic components, almost as much as the desire to halt Greenpeace's criticism of those manufacturers that continue to use hazardous chemicals such as PVCs and BFRs.

Faced with these relatively simple business realities it is apparent that those 50 per cent of IT departments that are still ignoring environmental issues are not just lacking a green IT strategy, they are without a decent IT strategy full stop.

Posted by James Murray on November 28, 2008 | Permalink | Comments (2)

Whisper it quietly, but could it be that they've only finally gone and got it?

I know that it is has become de rigueur for the people who keep an eye on these things to spend the weeks leading up to UN climate talks trying to kid themselves that this time it'll all be different, this time we'll see some real progress, before then having to go through the rather chastening experience of trying to explain why nothing much seemed to happen.

And yet, while remaining mindful of the fact that the green business movement has seen almost as many false dawns as a Geordie football fan, it is hard to escape the sense that a real sea change is now underway.

Much of this optimism can be attributed to the Obama effect. As everyone has noted there will come a time when he will inevitably disappoint, but so far the soaring rhetoric and pro-green policy commitments that characterised the election campaign have simply rolled over into the transition period.

It may not go down as one of his genuinely historic addresses, but his declaration this week that "any company that's willing to invest in clean energy will have an ally in Washington... any nation that's willing to join the cause of combating climate change will have an ally in the United States of America", will have sent waves of excitement through the entire green business movement.

What's more the reason for the optimism does not even rest on this rhetoric, inspiring as it is, but on the comparatively dull bedrock of policy and legislation.

Obama always said he would move fast, but the pace has been break neck. We can now expect a meaningful climate bill in front of the US Senate by January and Democratic control of the government means it will almost certainly be passed.

Meanwhile, California is forging ahead towards its goal of becoming the first large scale low carbon economy, this week unveiling another raft of tough legislation and cutting edge clean technologies that are beginning to make the previously heralded EU climate plan look decidedly tame.

It looks like the new business group that was formed this week to call for tougher climate change legislation might just get what it wants.

Over on this side of the Atlantic, the outlook is similarly upbeat.

When Gordon Brown announced, only a month ago, the formation of the Department of Energy and Climate Change (DECC) the general consensus was "great idea, but its success will depend entirely on how much clout it is given".

Well, a month on, it really does seem to have borrowed Gordon Brown's "clunking fist". It may not have much of a website, and the staff might still be settling into their new desks but the new department has been remarkably busy.

It has been easy to miss given the media's understandable focus on the economic crisis, but since its formation DECC has quietly heralded a significant toughening of the UK climate change policy.

Ever since it was first announced, green businesses and environmental groups have been calling for the climate change bill to be toughened and extended. Many privately admitted that they always expected their calls to fall on deaf ears, leaving the UK with a curates' egg of a climate change bill - impressive in parts, but fatally undermined by a failure to match emission targets with the realities dictated climate change science,

Instead, since the appointment of Ed Miliband as energy and climate change minister virtually everything green groups have been calling for has been delivered. The emission reduction targets have been tightened to 80 per cent by 2050 and extended to include aviation and shipping, a feed in tariff has been enabled and strengthed to cover more renewable projects than expected, and at the last hour the government has even introduced rules that will cap the extent to which overseas carbon reduction projects can be used to count towards the UK's targets.

Add in the fact that Miliband is also showing a remarkable willingness to stand up to the old school anti-regulation business lobby - to the extent where one green campaigner told The Guardian "Business leaders are telling us they can't remember the last time a secretary of state pissed off their lot so quickly" - and it is easy to understand why some environmentalists are scared to pinch themselves in case they wake up from their reverie.

Of course, with the latest figures showing that global carbon emissions are still climbing these policies need to translate into action as soon as physically possible. But it does seem that for the first time our political leaders are finally beginning to mobilise for the climate change fight.

Let's just hope that in a few weeks time I'm not writing another piece attempting to explain why this apparent sea change in attitude delivered no concrete progress at the UN climate talks in Poland.

Right, I'm off to re-read all this on my mobile.

Have a good weekend,

James

Posted by James Murray on November 21, 2008 | Permalink | Comments (1)

I've always been intrigued by the concept of risk - not the board game for wannabe megalomaniacs with the indecipherable rules, more the idea of trying to work out whether to expose yourself to the possibility of unpleasant events.

Our understanding of, and attitude towards, risk is one of the defining aspects of our personality, distinguishing the confident from the shy, the fearless from the cowardly, the indolent from the motivated, and the astute from the just plain dumb.

It is also the raison d'etre of one of the world's biggest industries in the form of insurance and its management should form one of the cornerstones of every other private and public sector organisation on the planet.

And yet, our understanding of risk always seems to me to be curiously confused and under developed.

At an individual level most of us, myself certainly included, would probably regard ourselves as a bit too risk averse. As the old maxim goes, you always regret the girls you didn't kiss, far more than the ones you did. It is almost part of human nature to look back on opportunities where we wish we had taken more of a risk, moments when we were too timid for our own good.

Yet at a social level humanity's recklessness is at times little short of terrifying. There is barely an economic, environmental or humanitarian disaster that could have not been avoided, or at the very least minimised, through a better early appreciation of the risks involved.

Apologists will inevitably claim that 20:20 hindsight is a wonderful thing and that every decision is rational at the time it is made, which is undoubtedly true. But at the same time some of the worst self-inflicted traumas of recent years (I'm thinking, global economic meltdown, disastrous occupations of Middle Eastern states, etc) were the result of some blindingly obvious risks being wilfully ignored (giving mortgages to people without any income, invading countries based on completely flawed intelligence, that sort of thing).

Climate change is of course nothing if not a risk issue.

There are plenty of environmentalists who argue that if people truly understood the risks our societies and economies now face as a result of global warming then they would be taking to the streets to demand immediate action.

At the economic level, the rationale for rapid investment in low carbon technologies and an overhaul of green legislation rests entirely on the premise that the financial threat posed by climate change is so great that it makes more sense to act now to mitigate the risks than try to cope with them later.

From the Stern Report, through virtually every other government and academic study on how to respond to climate change, this thinking has become established as conventional wisdom and been endorsed by political and business leaders the world over.

And yet, as Gordon Brown hints he wants to build a third runway at Heathrow and the Tories apparently edge away from their green commitments, it remains a colossal struggle to ensure that this apparent understanding of climate change risks translates into the real world actions that will help alleviate the threat.

The question is how do you hammer home to business and political leaders that the risks are real and that urgent action makes sense regardless of the current economic climate?

The answer is to treat them like children.

My mother, an indisputable source of wisdom who also used to work as a primary school teacher, always used to say that the reason it was so tricky to instil a sense of discipline in children was that their otherwise admirable sense of youthful invincibility meant they rarely imagined bad things would happen to them. They were almost incapable of analysing the risks associated with their actions and imagining a scenario where their misdemeanours were both detected and punished - regardless of how many times it happened.

It is a reckless streak many business leaders continue to display in older age, be it through their refusal to act to combat climate change, or, more locally, many small businesses common inability to prepare adequately for entirely foreseeable risks, such as black outs or floods.

The only answer - as any teacher who has had to face down 30 boisterous eight year olds will tell you - is to try and make the promise of reward and threat of reprisal as real and consistent as possible, until the realisation dawns that the risks associated with breaking the rules just aren't worth it.

For those seeking to help people wake up to the threat of climate change that means framing the associated risks entirely within believable contexts that an audience can understand.

For example, unless you live in the Maldives rising sea levels are too sci-fi a concept for many to grasp, but floods, wild fires and deadly heat waves are far easier to envisage.

Equally, if it is businesses that will drive the development of a low carbon economy then it is business risks that we have to focus on to stimulate the necessary investment. Global warming will result in higher insurance premiums, rising energy costs, increased geo-political instability and business disruption, and those global businesses that have risen to prominence in the last 100 years and wish to still be around in 100 years time need to be made fully aware of those risks as soon as possible if they are to survive.

As a report from the University of California this week on the potential cost of climate change for the state makes plain, these risks will have a huge and potentially disastrous impact on bottom lines and businesses need to be planning for them right now.

And if the threat of $2.5tr worth of assets being at risk from climate change in California alone is not enough to focus corporate minds, then perhaps it is time to start talking about something that will send a shiver down their spine, regardless of how hot it gets - litigation.

A separate report this week claimed that the risk of heat-related deaths will soar as a result of global warming. Now, not that I want to give the ambulance chasing lawyers any ideas, but if you can construct a strong case against cigarette companies for failing to act when they knew their were health risks associated with smoking, how long will it be until one of the firms that spent so long denying their contribution to climate change finds a high profile class action law suit landing on their desk?

Now, there is a risk business really should be able to understand.

Posted by James Murray on November 14, 2008 | Permalink | Comments (1)

For a few days at least, cynicism is officially suspended.

Yes, the world is in many ways exactly the same place as it was at the start of the week, its myriad problems just as intransigent as they were before Barack Obama's historic election victory.

But for now it is hard not to join in the global outpouring of optimism that has accompanied the election of the US' first black president - a man who single-handedly promises the diametric opposite to so many of the Bush administration's failed economic, environmental and diplomatic policies.

Of course, all those commentators counselling the world to take a deep breath and gain some perspective are entirely right to do so.

Throughout history the left has often been elected to clear up the right's mess and Obama is no exception. In fact, he has been handed a chalice so poisoned it would make a cyanide and olive Martini look almost appetising.

He has the advantage that Bush - a man whose approval ratings are lower than Nixon's on the day he resigned - has set the bar limbo-dancing snake low. In terms of policy, leadership, trust, credibility, and popularity Obama can only improve upon his predecessor.

But at the same time the challenges he faces are immense. The recession is only going to get deeper (it is worth noting there was no Obama bounce from the hard nosed realists that work the world's markets), the budget is a car wreck, the global energy crisis is worsening (as the IEA again warned this week) and the US remains embroiled in two wars.

Faced with these realities, funding Obama's many policy commitments will be supremely difficult. If the President-elect has not disappointed huge numbers of his supporters by early next spring then he really is a miracle worker.

And yet none of this should be allowed to take away from the scale of the change Obama promises.

When it comes to the environmental movement, it is not hyperbole to claim Obama's victory represents the most significant step forward, at least since last year's Bali summit breathed fresh life into international climate change negotiations, and arguably since the Kyoto Agreement and Rio Earth Summit of the nineties.

For years, uncertainty over future regulatory framework and market demand has represented arguably the biggest barrier to investment in and adoption of low carbon technologies.

Climate scientists, environmental campaigners and green businesses may have repeatedly argued that a global framework for tackling climate change is inevitable and as such early investment in renewables, energy efficiency and other green measures make long term strategic sense. But when asked to provide specific, detailed evidence to back up these predictions they have had gloss over the fact that the world's most powerful nation has spent eight years obstructing and delaying the development of that framework.

We all kept saying a more progressive approach to tackling climate change was inevitable, but if we're honest it didn't always feel that way.

There are still no guarantees a meaningful successor to Kyoto will be agreed in Copenhagen next year, and if there is one Bush policy Obama will retain it is the insistence that China and India also agree to play a significant role in the fight against climate change. But a deal looks far more likely than it ever did under the Bush White House, or would have done had McCain pulled off the biggest shock in polling history.

And regardless of the stance he adopts on international climate change negotations, one thing Obama will definitely deliver is far greater clean tech investor certainty than we have seen at any point in the past.

Businesses will have to wait for the first 100 days of his term of office for the precise details, but the election campaign made it clear that we can expect a president who regards the development of a low carbon economy as a top priority. Federal clean tech investment will climb, green incentives will get more generous, environmental standards will rise, the carbon market will get a huge boost with the creation of a US cap-and-trade scheme, and the legislative crack down on carbon intensive business models will get ever more severe.

In short, US environmental and energy legislation will end up looking a lot like that already being adopted by California, regardless of whether the rumours are correct and it is the California governor who ends up overseeing it.

And we can already see that this increasingly positive outlook is having an effect.

Taking the wind energy sector as just one example, the world's largest turbine manufacturer, Vestas, announced this week that as a result of the global recession its workforce is 15 per cent larger than it needs to be to handle projected demand over the coming months. But the company is adamant that it is not considering lay offs because the medium to long-term outlook for the industry is now so bullish that it makes sense for the company to retain some over capacity so it is well placed when the market inevitably accelerates again.

BP, meanwhile, would have announced that it is going to focus its wind energy investment on the US regardless of who won the election, particularly given McCain was also far more committed to tackling climate change than his Republican colleague in the White House. But its decision is further evidence that clean tech investors in general and renewables investors in particular are confident US support for the sector will continue to strengthen.

The development of a truly low carbon global economy still represents one of the biggest long term challenges mankind has ever faced. But as environmentalists and business leaders again ask themselves if we can ever successfully tackle climate change, it is tempting to look at the election to the most powerful office on the planet of a man who is clearly committed to taking on that challenge and borrow one of his favourite phrases: yes we can.

Posted by James Murray on November 7, 2008 | Permalink | Comments (2)

Last week, I half-jokingly said I was off to try and track down the three MPs who voted against the UK's world-leading climate change bill.

Well, my colleague Tom Young has gone and done exactly that, and found that not all of David Cameron's model green army are marching in the same direction.

Here's what he discovered:

In the world of politics, MPs are often required to put their personal views on hold for the greater good of the party.

Whips, the party political system, and personal ambition all conspire to pervert an MPs voting record to reflect factors other than their own beliefs.

Those factors were mercifully in absence last week as MPs voted through an ambitious Climate Change Bill that achieved the rare feat of drawing near universal praise from environmental groups and green business leaders.

The Bill had been toughened and could have expected more opposition from MPs with a more traditional view of what constitutes pro-business policy - targets were raised from 60 per cent to 80 per cent and are now likely to be extended to include aviation and shipping.

But despote the changes the bill was passed with an overwhelming majority - 463 votes for, and just three against.

But who were the three who refused to fall into line with both their party hierarchy and the unerring demands of climate change science.

Three Conservative MPs voted against the bill: Christopher Chope MP for Christchurch, Peter Lilley MP for Hitchin and Harpenden, and Andrew Tyrie MP for Chichester.

Their small number means this was not a whipped issue - David Cameron, George Osborne and a number of other frontbenchers voted with the government - so ist must have been a conscience vote.

Let's take at their arguments more carefully.

Christopher Chope is an ex-Conservative frontbencher, who used to be spokesman on, amongst other things, the environment, and undoubtedly reflects a pre-Cameron Conservative view on the issue.

In the most recent debate on the Bill he called for some "context" on the issue citing a PricewaterhouseCoopers report which projects that the United Kingdom will produce only 1.2 per cent of global emissions in 2050.

"Even if we eliminated that 1.2 per cent," he argued, "would it make any difference to the world? I do not think that it would."

Talking about his opposition to the second reading of the Bill, Chope said: "When the history books are written in 2050, people will ask why only five people voted against Second Reading of the ludicrous measure."

He argues that the bill will have an adverse affect on the economy, particularly with the inclusion of aviation and shipping, and that households bills will rise as business growth is inhibited.

Along with environmental groups and green businesses, the government has maintained that such arguments are outdated, citing the Stern Review's conclusion that failure to act now to tackle climate change will lead to greater costs in the long run.

Like Chope, Tyrie refused to be swayed by the Stern's Report citing one Professor Nordhaus' - who he describes as "probably the world's leading environmentalist" - view that Stern's conclusions are "completely absurd".

Tyrie recently quoted Nordhaus' belief that, "If a student of mine were to hand in this report as a Masters thesis, perhaps, if I were in a good mood, I would give him a 'D' for diligence; but more likely, I would give him an 'F' for fail."

And he doesn't stop there. The MP also cited a survey by Professor von Storch, "probably Germany's leading climate scientist", which says that one third of IPCC scientists don't believe recently observed warmings are man made.

Even if the Bill is passed, there will be no penalty for not meeting emissions targets, so there is little point, he argued.

His description of the bill is worth quoting in full, if only for the quality off its rhetoric:

"This Bill combines some of the characteristics of both the poll tax and the Dangerous Dogs Act 1991, except on a much grander scale. Either it will be implemented, in which case, like the poll tax, it could be as economically unworkable as it would be politically suicidal, or it will not, in which case, like the Dangerous Dogs Act, it will turn out to be yet another exercise in gesture politics."

On to Lilley, who describes himself as having "reservations about the certainty with which some people adopt the scientific case behind global alarmism", but is "equally uncertain that it is necessarily wrong".

As a result, he is "quite prepared to take out an insurance policy against the possibility that we will face global warming, just as I insure my house against the possibility of fire". But at the same time he is unconvinced that the insurance premiums imposed by the climate change bill aren't that bit too dear.

"Any measure that we introduce must pass two tests," he explains. "First, the benefits, even if they accrue to other people, must be greater than the costs, even if they are all incurred by us. Secondly, the measures must be effective, rather than just demonstrative."

Apparently the bill failed these tests as Mr Lilley decided to vote against the final bill.

So there are the three. We'd love to find out a little more about why they voted against the measures and the extent to which they support David Cameron's greening of the party, but none of them responded to my inquiries.

I also look forward to finding out if Mr Chope is right and those in the future will ask why more people did not vote against this "ludicrous measure".I'm guessing not.

Posted by James Murray on November 5, 2008 | Permalink | Comments (2)