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November 5, 2010

The CRC, the hype cycle, green IT. Oh, and pandas. Don’t forget the pandas

The CRC was introduced with much fanfare earlier this year but has turned into a bit of a damp squib. Gary Flood takes a look

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Is the Carbon Reduction Commitment (now called The CRC Energy Efficiency Scheme) a dud? We were all told – in that lovely Fear, Uncertainty and Doubt way we love in business, especially in ICT – that CRC would name and shame, force companies to clean up their act on their environmental impact, etc. etc. In the event: no-one’s that bothered about it, let’s be honest.

Why? It’s not scary enough. "It’s not getting the attention of the CFO as the money involved is so paltry. It’s a very modest fiscal risk if you break the barrier, only £12 a tonne. So it’s been pushed to juniors as a compliance issue," says Simon Mingay, Research VP into all things sustainable at research leaders Gartner.

Does that mean we can all go back to sleep and forget about Green IT? Actually no, according to Mingay’s team, which has collaborated with the Swedish branch of environmental campaign group World Wildlife Fund (WWF) to rank 19 of the biggest global information and communication technology providers on their climate change credentials. (They asked 28, by the way; only this many agreed to this audit, with Oracle, for example, refusing.)

The ICT industry sees climate change and sustainability as an emerging opportunity, sure – but as an industry is falling short of making climate change and sustainability part of its core business.

The message from the pair’s work is that though Green IT is in the depths of the ‘Trough Of Disillusionment’ part of the infamous (and very useful) Gartner Hype Cycle, this is precisely the time it should be taken most seriously – and that only a handful of vendors look up to the job of helping you sort this. (They are, as I’m sure you’re interested in knowing, held to be BT, IBM, Cisco, Ericsson, HP, Fujitsu, and SAP, all of whom scored the most on a set of metrics in things like internal environmental programmes and their progress in developing of a set of low-carbon market offerings. And because I’m feeling a bit mean today – shame on Verizon and Lenovo, who the research says, Must Do Better next term.)

That’s not to say even these guys are perfect. Mingay says that tech companies are very good at ‘the 2%’ problem – looking at ways to get a slightly more energy-efficient server, PC or data centre, working with relatively short term percentage reduction targets to deal with the ICT sector’s global CO2 contribution, said to be around 2% of the total of all industries.

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But they’re not looking at ‘the 98%’ problem – how to change industries and society to deliver a truly low carbon economy.

For Dennis Pamlin, co-author of the study and independent consultant working for WWF Sweden on this project, "If the ICT industry is to deliver on its promise of making a significant contribution to enabling a transformation to a low-carbon economy it is going to require substantially more than marginal incrementalism."

"The good news is that we don’t see anyone going backwards," said Mingay. "We now have a number of ICT providers with an actual low carbon portfolio and a readiness to move from an incremental contribution into the centre stage when it comes to providing society with low carbon solutions," added Magnus Emfel, director of Climate Programme, WWF Sweden.

"It is precisely this shift — from ICT as a minor contributor to global emissions to a major enabler of low-carbon solutions — that we need to see replicated in business strategies and urban planning, if we are to succeed in the transition to a low carbon economy and stabilise the climate."

And some are doing pretty well; SAP, ranked 8th overall, did "substantially better than any of the other large software and services organisations," we are told, as it has "put sustainability at the heart of its communications and closer to its strategy over the last 18 months". The survey also found that Fujitsu, ranked second, is "the only ICT provider to set a long-term context to its initiatives, and wants to help reduce more emissions in society through low carbon IT solutions than its own emissions".

Back to the Hype Cycle and the CRC. Mingay told us that the reason something like CRC will change behaviour in the end isn’t the financial penalty – though he is sure that £12 figure is the thin edge of the wedge. It’ll be reputation and brand.

"What will change CEO’s minds will be the stain of being at the bottom of these league tables. As soon as that starts happening, they’ll be investing in this and looking to partner with companies that have shown real leadership and commitment to do more than just pay lip-service to all this. The Low Carbon Economy will be ICT-enabled – which means the companies doing the work now will end up on that Plateau of Productivity," he says.

Unconvinced? To use another Gartner mental tool that’s very useful – what you don’t want to be is the best at the dead way of doing things and miss the future.

Also known as: do you want to be the best Buggy Whip Manufacturer in your town?

Go here to see a nice graphic of the Hype Cycle. You might be interested in a video that highlights additional views from Mingay here.

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