Turning green into gold

According to recent reports, the information and communications technology (ICT) industry emits the same amount of carbon dioxide as the aviation industry. Data centres, for instance, require a significant amount of energy to operate servers, but use the same amount again to run the air conditioners that are required to keep them cool. However, although all industries have incentives to lower energy usage and reduce emissions, the ICT industry is uniquely able to perform the modern alchemy of turning green into gold.

The rapidly increased demand for Internet services has translated into both an increase in the number of data centres and a greater concentration of servers, with a significant increase in energy usage. Global Action Plan recently released a report stating that a medium-sized server has the same environmental impact as an average sports utility vehicle, and a recent report by the US Environmental Protection Agency (EPA) stated that data centres and servers in the US are now consuming 1.5% of total US electricity, at a cost of €2.87 billion/US$4.5 billion. This is more than double the equivalent figure for 2000, and is expected to double again by 2011 based on current trends.

However, the very nature of ICT lends itself to solutions for reducing the impact of its energy requirements in several ways:

"¢ First, improve the technology in the data centre. The EPA report calculates that data centres adopting energy-efficient technology could save up to 55% of consumption, which could actually reduce energy consumption from today's levels in spite of increased usage. Vendors are already beginning to supply solutions to help reduce energy consumption. Furthermore, the technology that drives the Internet actually demands less energy than earlier related technologies; the move to IP-based next-generation networks (NGNs) will therefore result in savings over traditional circuit-switched telecoms networks.

"¢ Second, replace the energy source. For instance, one transatlantic capacity provider, Hibernia Atlantic, is building a submarine cable to Iceland where data centres can be run using sustainable geothermal and hydro power. Google, whose data centres consume a significant amount of energy, has announced an initiative to find sources of renewable energy that are cheaper than coal.

While the provision of Internet infrastructure may represent a significant source of emissions, many Internet services and applications themselves have emerged as more energy-efficient solutions to existing requirements: for instance, a number of Internet services are used to reduce transportation needs, including notably telecommuting, video-conferencing, distance learning and telemedicine.

Furthermore, utilities can harness the Internet for remote monitoring of usage to make their own power-generating operations more efficient: access to detailed real-time data on energy usage allows them to monitor and even fine-tune usage to make consumption more even and therefore more efficient and to allow customers to save money.

As shown in the examples above, the ICT industry is now beginning to take steps to reduce energy consumption to monetise possibilities to lower energy usage and respond to environmental concerns. As of now, we know of no public policies aimed specifically at "˜greening' the ICT industry. On the other hand, policy-makers considering the negative externalities of energy usage should, at the same time, consider positive externalities of promoting broadband in order to reap the energy-reducing benefits that broadband can provide.

Michael Kende, Principal Consultant, Analysys