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David Silversmith

New 'Cap & Trade' Law Spells Work for IT

5/14/2009 6 comments
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Are you deciding where to build a new data center, or how many new cooling units to add to it? If so, you have typical IT decision-making ahead -- weighing all the costs and benefits, considering corporate goals, making recommendations, and so forth.

However, pending legislation on Capitol Hill called the Waxman-Markey bill could add something else to your decision making: scrutiny of the "caps" on carbon emissions and the market to "trade" carbon allowances.

If "cap-and-trade" is a new term to you, you fit into the mainstream. A Rasmussen Report survey reveals that just 24 percent of voters can correctly identify the cap-and-trade proposal as something that deals with environmental issues.

So let's summarize the basics of this 600-page legislation: A cap occurs when the government sets a maximum allowable level of pollution nationwide and penalizes companies that exceed their emission allowances.

You might think this is all about big utility plants, but think again. Environmental studies show that carbon dioxide (CO2) emissions from the information and communications technology (ICT) industry exceed the carbon output of the entire aviation industry.

So, your company will get permits for the amount of CO2 you can emit each year; then your company will have to either lower its CO2 emissions or trade for allowances from other companies.

If you are able to reduce the pollution from your data centers, your company could end up with extra allowances it could sell to other companies. Further, if your organization has power plants or manufacturing facilities, your reductions on data center emissions could be traded to those other facilities where the costs of decreasing emissions could be much higher.

Sounds simple, right? Many Websites and blogs offer to explain cap-and-trade, but most have a very distinct bias for or against. If you want to learn more and have an additional three minutes and thirty seconds to dedicate to this subject, then check out this YouTube video by EcoGeek Hank Green. While Green is obviously in favor of anything that helps the economy, he is not afraid to use the dreaded "tax" word in describing this legislation.

The Waxman-Markey bill has prompted my thinking in several directions. It's clear that the information industry has quite the potential to reduce carbon emissions at low cost. While I don't pretend to understand how a power plant gets retrofitted to reduce emissions (that can't be cheap), IT has a number of options that, comparatively at least, could be quite effective and affordable:

  • Migrate data centers to zero-carbon facilities. Data center space in locations such as Iceland and Lithuania have harnessed renewable power through wind, geothermal, and hydroelectric resources.

  • Download software instead of purchasing packaged software. Microsoft Corp. (Nasdaq: MSFT) worked with its partners, Accenture and WSP Environment & Energy, to set precedents for product carbon footprinting. Transportation and packaging materials were identified as the largest contributors to carbon emissions for off-the-shelf software products. The carbon emissions associated with downloading a single copy of Office 2007 are roughly equal to one gallon of gas.

  • Use technology to encourage telecommuting. The servers will be running regardless of whether the employees are in the office or at home. But if the technology is secure and easy to use from home, your company can reduce commuting and its emissions.

  • Establish effective policies on powering down PCs and monitors overnight. According to data from Cisco Systems Inc. (Nasdaq: CSCO), 25 percent of carbon emissions from buildings can be attributed to ICT equipment. Waxman-Markey will lead to your landlord being much more interested in your power consumption, so it pays to find ways to keep gear off when it's not in use.

Waxman-Markey is yet another instance pointing to how everything Is IT's business. So, along with reading about the next version of Windows, and what Twitter is doing to keep your employees distracted, it's time to start reading the political section of the newspaper (should one still exist in your town) or scope out some blogs.

For IT directors, Waxman-Markey could be the next Sarbanes-Oxley.

— David Silversmith, Internet and Web analytics consultant, and former CTO of Carfax

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lpricci49
IQ Crew
Sunday May 17, 2009 11:36:43 PM
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A data center has a special property.  It can export emissions.

I think data centers consume about 25% of the power in the overall IT infrastructure.  The PC clients- usually on someone else's electric meter- use much more- 50% or so.

So, the data center that uses simple HTML puts little load on the clients.  One that uses Silverlight, more and one that needs Ajax the most.

The overall use by IT is not small- projected to be 2% of CO2 load in 2020- about the same as airlines.  It would be good if it were optimized holistically.

Lawrence Ricci
www.EmbeddedInsider.com

 

DHagar
Thinkernetter
Friday May 15, 2009 7:15:34 PM
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David, I think you are right.  Either way, the idea is going to stick in terms of lowering the energy consumption of IT, whether it comes in the form of financial incentives, or regulated violations.

It does make sense to anticipate and look for ways to design the energy use more effectively.

I also agree that this will spawn an entire industry of "support services".  Here we go again - Y2000!

DHagar

DavidSilversmith
Thinkernetter
Friday May 15, 2009 12:13:50 AM
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Great point.  I actually cut that our in the final draft (got a little wordy...) but like most legislation or certifications this will generate a whole cottage inustry to help create, track and regulate the allowances.

It reminds me of PCI compliance in the credit cards industry.  PCI has no teeth and has little impact on credit card security - but a ton of consulting companies have made plenty of cash selling PCI audits!

I'm sure that somewhere along the way this program will be touted as part of the job creation programs to restart our econonmy!

DavidSilversmith
Thinkernetter
Friday May 15, 2009 12:09:16 AM
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I'm not sure the hosting and SaaS industry has enough political clout to push this agenda.

On the other hand - they certainly should be dancing the jig (or whatever the popular dance is in Iceland and Lithuiana) if this legislation makes it through!

jabailo
IQ Crew
Thursday May 14, 2009 10:12:50 PM
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I thought the topic was going to be all the regulation, monitoring and analysis that programmers will need to build to satisfy green requirements.

 

Cap and trade could be a bonanza for companies in the data mining, web services, interface, electronics, accouting trades.

jpmessenger
IQ Crew
Thursday May 14, 2009 8:57:00 PM
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As if CIOs didn't have enough to consider and manage, yet another layer of complexity could one day be added. Not to sound like a conspiracy theorist, but I wonder how much this could act as a boost to hosted services?

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