Comment by Tony Chan
2007 was a historic year for the energy sector and its increasingly related half-sister – climate change. It was the year that Al Gore received a Nobel Peace Prize for his documentary film (and worldwide lecture tours) on the pending threat of climate change, a year when the price of oil surged some 57% to near the US$100 mark, a year in which the IPCC (International Panel on Climate Change) confirmed that we are harming the planet, a year in which the Clintons played up climate change as the next impetus for economic growth for America, the year where Australia ratified the UN’s Kyoto Protocol.
For the IT and telecoms sector, 2007 was not at all a bad year. Bandwidth demand accelerated with the widespread adoption of video on the Internet, .while 3G and 3.5G technologies continued its steady growth in the mobile space
Above all else, 2007 marked a turning point for the IT and telecoms industry. It was the year that the industry stepped back and looked beyond driving growth, of hardware, software, devices, services, and started to think about how to make things work better, more efficiently, and with lower energy consumption. Energy efficiency is now a top priority for all major vendors, from IBM, HP and Sun, to Nokia Siemens Networks, Ericsson and Motorola. Likewise, carbon reduction has emerged as a major operational metric for operators, with big names like British Telecom and Telstra already reaping the benefits of using less energy, from travel, from operations, from better management of resources.
Increasingly, IT and telecoms firms are looking at climate change beyond the scope of corporate social responsibility and seeing the business potential of helping their customers reduce their carbon footprint. Having established a concrete platform for reducing energy consumption, British Telecom is now offering its experience in the form of consultancy services to help others reduced their footprint. IBM, on the other hand, has partnered with independent energy consultants, Neuwing Energy, for its IBM Energy Efficiency certificates, which will effectively pay its clients credit for reducing energy use inside datacentres, presumable only when they use IBM equipment to do so.
Renewable energy deployments also made headlines with companies such as BT and HP announcing major initiatives. BT said it is planning to spend some £250 million to build wind farms to power its facilities across Britain. Meanwhile, HP pledged to build a solar power generation facility besides its San Diego campus to supplement its energy supply.
Google, already a major user of solar power systems for its massive data centres, went a step further and launched its RE < C initiative, pledging to fund research to achieve a gigawatt of electricity capacity from renewable sources at a cost below current power generated by coal fire plants. With the price of oil already hitting three-digits in the first week of 2008, it is almost a certainty that energy costs will go up. On the other hand, governments around the world have started to focus on reducing their reliance on fossil fuels and supplementing their energy supply with renewables. Many administrations are starting to offer incentives, subsidies and tax concessions to encourage the migration to renewable energy. Other measures bring stronger restrictions on emissions, such as the recent US Energy Bill, which while failing to mandate renewable energy development, does impose stricter levels of vehicle emissions. In this environment, there are ample opportunities for the IT and telecoms sector. Stricter carbon policy means that older systems will need to be replaced with new, more energy efficient systems. Services such as video conferencing to reduce travel emissions, GPS fleet management services for route and load optimization, and virtualization, of server clusters, networks, lights, infrastructure, are all business opportunities for the information technology and communications industries.