Cleantech: viable, thriving and future-oriented

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A new report from audit specialist Grant Thornton paints an upbeat picture of the cleantech sector's future prospects which is in stark contrast to that of most global industries.

The report, "Capturing opportunity: Cleantech business booms around the world", reveals that privately held businesses in the cleantech sector are among the most confident enterprises in the world when it comes to future prosperity, far outpacing the optimism - or even pessimism - found in older, traditional industries.

A thriving cleantech sector also typically means thriving subsectors, as merger and acquisition opportunities and IPOs grow exponentially, driving further demand for cleantech financial and consulting services. For example, investment in the capital-intensive cleantech sector is being driven to record levels by government policies, stimulus funding and recovering financial markets and investor attitudes.

The Jefferies CleanTech Survey, conducted at the 11th Global Clean Technology Conference in 2011, found that:

  • approximately two-thirds of investors surveyed believe that a full recovery of the IPO market for cleantech companies is likely to occur by the first half of 2012
  • more than three-quarters of investors surveyed believe that large company conglomerates are expected to begin consolidating the cleantech sector during or after 2012
  • stable government subsidies and regulation are seen as being the most important growth driver for the cleantech sector

Businesses in the cleantech sector around the globe expressed optimism about the economy for the next 12 months, with net 37% optimistic in 2011, up from net 34% in 2010. This contrasts with the all-sector average, which declined from net 24% in 2010 to net 22% in 2011.

In the UK, like other countries such as India and South Africa, government policies, rather than market demands, drive much of the cleantech activity, according to Nathan Goode, partner, head of energy, environment and sustainability at Grant Thornton UK.

"Government support and the regulatory environment generally are very important, and the government is now in the process of undertaking some very significant changes to the electricity market in general, not just in the support for cleantech," says Goode.

"Nobody is entirely sure how that is all going to pan out. The high-level view is that this government is committed to securing a low-carbon economy, both in terms of energy and other sectors, but the detail of what that really means for investors and businesses is highly uncertain at the moment. Having said that, we're seeing much more deal activity, and we are seeing businesses in different parts of the cleantech sector actually starting to make money."

 

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DECC announces new consultation on CRC

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Following Chancellor George Osborne's strong criticism of the complexity of the Carbon Reduction Commitment (CRC) Energy Efficiency scheme in last's Budget, the Department of Energy & Climate Change today announced a new consultation.

DECC's new-look CRC when it comes in will include:

  • A shortening of the CRC qualification process.
  • Reducing the number of fuels covered by CRC from 29 to 4.
  • Reducing the amount of reporting required by businesses.
  • Reducing the length of time participants will have to keep records.
  • Removing the requirement on facilities covered by Climate Change Agreement or EU Emissions Trading System installations to purchase CRC allowances. 
  • Adopting new emissions factors for the CRC which will align it with Greenhouse Gas reporting processes.
  • Removing the detailed metrics of the Performance League Table from legislation and placing them in government guidance.

The formal consultation will run for twelve weeks from today. Following on from this, the Government plans to amend the legislation for CRC by April 2013.

DECC issued this press release about its plans.


 

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Chancellor's Budget signals likely end for CRC energy efficiency scheme

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George Osborne couldn't have made much clearer his lack of enthusiasm in today's Budget for the Carbon Reduction Commitment (CRC) Energy Efficiency scheme.

He said: "Environmentally sustainable has to be fiscally sustainable too. The Carbon Reduction Commitment was established by the previous Government. It is cumbersome, bureaucratic and imposes unnecessary cost on business.

"So we will seek major savings in the administrative cost of the Commitment for business. If those cannot be found, I will bring forward proposals this autumn to replace the revenues with an alternative environmental tax."

My guess is that (conveniently) those administrative costs won't be found, and that CRC will be killed off. The Government has never thought much of CRC, and has signalled here its intention to end it - though what  - if anything - will replace it isn't clear.


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Software Improvement Group breaks trail to help make software more energy efficient

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I recently wrote a piece about 8 ways to make your software more energy efficient.

The company that provided the advice, the Software Improvement Group (SIG) based in Amsterdam in the Netherlands has set up a lab together with the nearby Hogeschool van Amsterdam (HvA) to investigate further how to make software more energy efficient. 

The Software Energy Footprint Lab (#SEFL) will enable researchers to find answers to questions such as:

  • How do different database management systems compare to each other in terms of energy consumption?
  • How do different programing languages/compilers compare to each other in terms of energy consumption?
  • How does asynchronous requests compare to synchronous requests in terms of energy consumption?
  • How does unsigned integer arithmetic operations compare to signed arithmetic operations with respect to energy consumption?
  • How accurate are software energy profiling tools?

SIG's Head of Research Joost Visser explained some of the thinking behind the energy efficiency investigations, which aside from sustainability and energy drivers, also have key drivers for organisations in terms of cost and scarcity.

"There are basically two types of this problem that you can break this down and look into. One is across the software lifecycle. So just as with software defects where the later you find them the more expensive they are, so with energy efficiency, if you try to optimise your software once it's already in production, you may have to make an explicit investment that might not provide an adequate payback. But if you already know what requirements you need to keep in mind at the design stage for energy efficiency, then, for example, you might actually choose a different communication protocol which can improve your efficiency. At each of the development process, there are things to do: in requirements, in the coding and in the testing.

"Another issue is the hierarchical level of software. The thing you might see as the consumer is the application. But actually that's not the first level that impacts energy efficiency. The first level is the user themselves. If they know what the consequences are of clicking here and searching there, they might behave slightly differently and it might have an impact on energy efficiency. If you give people feedback, they will behave differently.

"There is a premium on green products. People want to be green - but they have to be able to make a meaningful choice. There are various elements to consider. First there is the application layer. Then we have the various components from which the software application is built: a database; a runtime environment framework, and Java as a virtual machine. Then underneath there's the operating system.Then there is communication. You have to think about your mobile device uses radio to communicate when you're browsing. You may have to make an explicit switch to a Wi-Fi network which might be more energy efficient. Is it more energy efficient than 3G? We don't know yet. That is one of the things we're going to find out.

"If you keep all your browser tabs open, do you as a user know if that has any impact, or is that negligible? If you knew it was consuming energy, maybe you'd take the trouble of closing them because it has value for you. Energy consumption goes further than simply your own device. If you're browsing, you're pulling information in, and the server starts doing things for you and data starts being generated. It might be stored, consuming energy, for the next 50 years. And it makes a difference how it gets archived or stored. All of this has to be made simple for the consumer to comprehend.

"Then there's the organisational side, those organisations that have bespoke software built for them. They might be interested in 'green' from an idealistic point of view. Their clients are interested too and they want to be socially responsible. But those organisations are also very much interested in the cost aspect. Energy costs are rising and it's not just costs, but scarcity too. If more work implies more energy, at some point you may not be able to get it as easily as before. Either you will get it back in higher energy costs or it just won't be there.

"One of the things we need is a benchmark. To have a benchmark, you need comparable things. But think about it. You have online payments for a bank versus using a browser. The type of work you do with the software, the user transactions, so to speak, is completely different.  If one consumes a certain amount of energy and the other consumes double that, what does that mean? Does that mean the one that consumes more is worse? Not necessarily. It may simply be doing more work. So we have to develop KPIs that allow meaningful comparison. We could talk about how much energy per function point. That sounds good, but actually it's completely wrong, because a function point is about functional size and how many features you offer. It doesn't have anything about the workload in it. You have to involve the workload into the KPI otherwise it cannot work.

"But workload is something that's completely different between different vendors and operations systems and end users. Comparing an operating system to an end user application will not work. That's why we're trying to build these things up through the work of the lab."

Software Energy Footprint Lab Opening

 

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8 ways to make your software applications more energy efficient

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I recently came across some work done in the Netherlands by the Software Improvement Group (SIG) which examined the energy efficiency of the way software applications have been developed and has produced some quick wins as first steps towards energy efficiency.


1. Reduce resolution of images and/or send them less frequently
When pictures are used in mobile applications, these pictures must be sent of the internet and radio connection, which is a major source of energy consumption. By reducing the size of these images or uploading them less often, energy can be saved. In particular, applications that run in a mobile browser can benefit greatly from this quick win.

2. Run multiple applications on shared servers
If each application runs on its own server, these servers will be doing nothing useful most of the time. But they are on, and consume electricity, all of the time. By letting applications share servers, fewer servers are needed to do the same work. Many applications can be easily made suitable to run on shared servers.

3. Reduce data translation between components
To make various components of a software system work together, translation may be needed of the data that they exchange. Such translations can be computationally expensive. Sometimes, multiple translation steps are performed rather than translating from source to target in a single step. Also, the intermediate formats can be overly verbose, leading to big files being transferred that could be much smaller. By simplifying the formats and the translation steps, unnecessary energy consumption can be reduced.

4. Log less
While developing software, it is useful to let the application log the steps it is taking and their intermediate results, to diagnose bugs or other problems. Writing logging information to disk and storing large log files consumes energy. But when the finished application is deployed in a production environment, much of this logging information is not used. By using a logging framework that allows the degree of logging to be reduced when logs are not used, unnecessary energy consumption can be avoided.

5. Delete historic data
An application that supports a certain business process needs to store information about business transactions. After the business transaction has been concluded, most applications will retain data related to that transaction for possible future reference. This data is often kept "alive" without being used. Year after year it sits in memory or on a hard disk and thus causes energy consumption. By purging old transactions from the application database, the storage needs can be prevented from growing larger and larger, and energy can be saved.

6. Compile interpreted languages
Many applications are developed in programming languages that are not compiled to efficient machine code before deployment, but that are translated by an interpreter to machine code while the application runs. Such interpreted code typically requires more processing power, hence more servers consuming more energy to do the same work. For some of these interpreted languages, such as PHP, a compiler is also available. By making small changes to the application code, it can be made suitable for compilation, after which it can be run more (energy-)efficiently.

7. Refrain from frivolous features
Modern development toolkits make it possible to create astonishing user interfaces, full of graphics, animations, assisted editing, suggestions for further navigation, etc. Sometimes such features are useful because they enrich the user experience and make the user more productive in the tasks to accomplish. When copying a file from one folder to another, do you really need to watch sheets of paper fly from one end to another? Features that offer no value to the user generally do consume energy, which can be saved by omitting them.

8. Avoid chatty protocols
The communication protocols between components of an application can involve many messages being sent back and forth. In case of smart phone apps, radio traffic is a major source of energy consumption, which can be reduced by not establishing a new radio connection for each message, but saving up several messages until a number of them can be sent at once. For example, apps could save information to the server only after a number of data-entry screens have been completed, rather than after completing each screen.

These quick wins do not always apply and are only a first step towards energy efficiency. To create truly energy-efficient software applications requires attention during all phases of the lifecycle, starting from requirements and design, followed by coding and testing, and finally deployment and operation.

More information

Knowledge Network Green Software website


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Durban conference showcases key role of ICT in climate change policies

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There will be lots written this week about the United Nations conference on Climate Change taking place this week in Durban.

Already the International Telecommunications Union (ITU), together with a coalition of industry partners, has said it will be using the Durban COP 17 conference to promote ICT technologies as the 21st century's most valuable problem-solving tools. ITU believes it is imperative that they be included as an integral part of global climate change policy.

 

The coalition's message is simple: ICTs such as smart grids, intelligent transport systems and the so-called 'Internet of Things' have extraordinary potential to reduce the greenhouse gas (GHG) emissions of other high energy-consuming industry sectors, and must be included in any meaningful climate change policies at the global, regional and national level. To prove its point, the coalition will be showcasing how the ICT industry is using technology to reduce its own carbon footprint.

During the 10-day conference, the coalition says it will undertake a number of initiatives to get the message across, including two new ITU reports showing how ICTs have helped Ghana mitigate and adapt to the effects of climate change.

With climate change and Durban in mind this week, though I suspect not as high profile as it has been previously, I liked this blog written by Colin Curtis, director of sustainability at Dimemsion Data, who discusses how the company's own IT department has performed in reducing the organisation's carbon footprint, notably through virtualisation.


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Environment Agency publishes Carbon Reduction Commitment League Table

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The Environment Agency has published the initial league table for the Carbon Reduction Commmitment (CRC) Energy Efficiency scheme.
As the Agency puts it, the Performance League Table (PLT) ranks organisations participating in the CRC on how well they manage their energy efficiency. PLT positions are based on a participant's changes in energy use against a baseline and not their total emissions. As a result the PLT should motivate organisations to improve their energy efficiency.
The 2010/11 PLT recognises those organisations who have already taken action to monitor and reduce their carbon emissions and is based on information supplied by participating organisations.
The Agency's website is already under pressure today from the number of hits on the site, but the table is available as an Excel file here

CRC league table now expected in November

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I hear that the league table associated with the Carbon Reduction Commitment (CRC) energy efficiency scheme is now likely to be published in November.

This blog post on Local Energy suggests that a November date is expected. That could mean the table will be out next week or alternatively, it may still be a month away.

Local Energy quoted Carl Sweeney the Operations Manager of the CRC Energy Efficiency Scheme at the Environment Agency, saying:

"At this time, we anticipate that the PLT will be published in November. We have agreed with DECC that we will notify participants of the publication date one week before release. There is much ongoing work in the background to review and produce the PLT as accurate as possible, so at this stage I can't be more specific as something unexpected could delay us."

Third parties familiar with the situation say that the Environment Agency is getting 'a lot of calls' on when the table will be published. 

What does the league table mean? The Carbon Trust puts it like this:

"A publicly available CRC performance league table will show how each participant is performing compared to others in the scheme. If your organisation is a good carbon performer, the league table will help give a significant boost to your organisation's reputation, demonstrating its success in cutting emissions. Please note, however, that because of the changes announced in October 2010, there is likely to be no direct financial benefit under the CRC from an improved position in the league table.Your organisation's league table position each year will be determined by performance in three metrics:

  • Early action metric: 50% of your score is based on what percentage of your organisation's electricity and gas supplies is covered by voluntary automatic meter readings (AMR) in the year to 31 March 2011. The other half is based on the proportion of your CRC emissions certified under the Carbon Trust Standard or an equivalent scheme. Visit www.carbontruststandard.com to find out about achieving the Carbon Trust Standard.
  • Absolute metric: The percentage change in your organisation's emissions, compared to the average of the previous five years (or number of years available until 2014/15).
  • Growth metric: the percentage change in emissions per unit turnover, compared to the average of the previous five years (or number of years available until 2014/15).

The weighting of these three metrics will change over time. In the first year, early action will count for 100% of your organisation's league table score. Over the first few years of the scheme, the early action metric will gradually fade in importance until the absolute and growth metrics receive 75% and 25% weightings respectively in 2014/15 and thereafter.

As the Carbon Trust points out, if an organisation is a good carbon performer, the league table will boost its reputation, though there will be no direct financial benefit under the CRC from an improved position in the league table.

However, when the results come out, you can well imagine a few marketing departments either keen to trumpet their organisation's performance or, conversely, trying to shore up their company's 'green' reputation.

What it means in terms of best practice for CIOs we'll probably have to see what results the league table brings.

 

What Sustainability should learn from Steve Jobs

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I liked this blog post from Andrew Winston entitled 'What Sustainability should learn from Steve Jobs.'

Winston, who writes regularly for the Harvard Business Review argues that before the iPad was introduced,  many were asking why you'd need a tablet computer. Steve Jobs, he says, made us want one.

Winston suggests that most large companies today are "fast followers" -  but second place is nowhere in the tablet computer space.

"Fiscal and strategic conservatism breeds a culture where execs prefer to wait and talk to customers before doing anything drastic. Of course customer (and other stakeholder) perspectives are critical. But as with tablet computers, when it comes to sustainability, often the customers don't really know what they need.

"Companies often gather data on what their business customers think a sustainable product should be, and the survey might show that including recycled material is important, even if that's a tiny part of the real footprint story. Nobody knows the value chain of your product and service as well as you do (or if someone else does, get them in the room pronto). So figure out where the impacts really lie and what you can do to reduce your customer's footprint in ways they hadn't considered. This might require asking heretical questions about whether the product should even exist in its current form or should be converted into more of a service." 

Winston believes the next generation's Steve Jobs is likely to focus on sustainability since that's where the largest challenges and business opportunities lie. Worth a read.

Carbon Trust launches footprint verification service

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The Carbon Trust has launched a new service to provide companies and organisations with independent verification of their corporate carbon footprints.

The Footprint Verification service is intended to help companies and organisations manage the increasing demand for carbon emissions data in CSR & annual reports and websites, as well as to support the disclosure of emissions to third party stakeholders, including shareholders and investors. 

Organisations that use the service will be able to display a Footprint Verification logo in conjunction with the carbon footprint data, showing that their emissions have been independently verified. The Trust says that the verified carbon footprint provided is compliant with both the internationally recognised GHG Protocol, as well as the Carbon Disclosure Project (CDP).

The new service follows new findings from the Carbon Trust that 50% of multinationals will look set to select their suppliers based upon carbon performance in the future.







Hard copies means hard choices: why low carbon thinking means ITTs for printers must change

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In this guest blog, Tracey Rawling Church, Director of Brand and Reputation at Kyocera Mita UK explains why the public sector must stop buying printers

Hard Copies Mean Hard Choices

To cut its costs and carbon emissions, the public sector should stop buying printers.

That may seem a ridiculous statement, coming from an imaging company executive, but actually there's a serious point here. Most ITTs are written around a notional product - calling for a certain number of machines of a certain specification. And the tender process is quite rigid, so companies invited to tender are forced to propose a solution that fits the criteria in the ITT. But in many organisations, the number of devices has crept up over time and device to user ratios are unnecessarily high - so replacing machines on a one-for-one basis only perpetuates a system that has become bloated and inefficient.

Sometimes the decision is made to consolidate devices, replacing desktop printers with shared multifunctional devices and an ITT is written on that basis, but to achieve real efficiencies that could reduce costs by typically 30% and carbon by as much as half, a detailed print audit should be undertaken to determine precisely what hardware is needed at which locations to support business processes.

However, even this approach misses the opportunity to obtain a solution that is properly optimised not just at the point of implementation, but into the future.

In the private sector, there is a growing trend towards managed document services, a holistic approach that encompasses every aspect of the printing and imaging needs of an organisation. A managed document service project begins with a detailed audit of both the machines currently in place and the document flows through and within the organisation. Then a solution is designed that aims to reduce reliance on hard copy by combining document management software with a fleet of machines that have exactly the right functionality to support the document flow.

In most cases, this results in a much smaller number of devices, usually with more extensive functionality than those they replace. A bespoke service contract is crafted that includes remote monitoring of device states, service support to agreed service levels and detailed reporting of device use that can be segmented and analysed in a myriad of ways. And using the business intelligence gained from the reporting suite, the service can be continuously optimised to ensure it remains efficient, accommodating changes in the organisation over time.

For example, the managed document solution provided for insurance giant RSA has reduced paper consumption by 21% in just one year - despite the fact that their product depends on having a printed certificate. And energy consumed by imaging devices has been reduced by 55% with resulting savings in both electricity costs and CRC levies.

As you can imagine, this type of service doesn't fit easily into a device-centric ITT. So vendors who know they could save cash and carbon through applying a managed document service are forced to respond with a 'round peg, square hole' solution that is less than ideal, simply because the tender process focuses on products rather than outcomes. Concerns about carbon emissions and resource scarcity are driving the evolution of innovative business models that overturn conventional norms and challenge the status quo. But unless procurement processes keep pace with these changes, the benefits of this fresh thinking won't be realised.

To really drive through change, let's have ITTs written by commercial managers and procurement departments that focus on objectives and targets rather than feeds and speeds. Throw down a challenge to reduce paper consumption by x, cut energy use by y% and drive down costs by z and see what the industry comes up with. I guarantee it will deliver solutions that are more resource efficient, productive and economical.

Links:

Events: http://www.kyoceramita.co.uk/index/events.html

MDS in the public sector http://www.kyoceramita.co.uk/index/mds/mds_in_the_public.html

RSA case study http://www.kyoceramita.co.uk/index/products/happy_customer_stories/happy_customer_stories_detail.L3ByaW50ZXJfbXVsdGlmdW5jdGlvbmFscy9jYXNlc3R1ZHkvbGVhZGluZ19pbnN1cmVyX3JzYQ~~.html

For the full results of latest independent research into printing attitudes and behaviour, email Tracey: trc@kyoceramita.co.uk

 

 

 

 

 

Carbon Disclosure Report says carbon reduction plans deliver better stock market performance

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A report by the Carbon Disclosure Project has suggested that companies that implement policies to reduce carbon emissions perform better on the stock market compared with those that do not.

The 2011 edition of the annual Carbon Disclosure Project (CDP) Global 500 report, which examines carbon reduction activities at the world's largest public corporations, has found for the first time in the ten year history of the survey, that the majority have climate change actions embedded as part of their business strategy. The report, written by professional services firm PwC, attributes this to growing board-level awareness of the link between energy efficiency and increased profitability.

The report, entitled Accelerating low carbon growth, analysed disclosures from 396 of the world's largest companies, which revealed 68% have climate change at the heart of business strategies, compared with 48% in 2010. There was also a marked rise in the number of companies reporting reduced greenhouse gas emissions as a result of emissions reduction activities (45%, up from 19% in 2010).

A correlation was also established between higher stock market performance over time, and representation on CDP's Carbon Performance Leadership Index (CPLI) and the Carbon Disclosure Leadership Index (CDLI). Companies with a strategic focus on climate change provided investors with approximately double the average total return of the Global 500 from January 2005 to May 2011.

Paul Simpson, CEO of the Carbon Disclosure Project, said: "The improved financial performance of companies with high carbon performance is a clear indicator that it makes good business sense to manage and reduce carbon emissions. This is a win win for business - the short ROIs many emissions reducing activities have, can help increase profitability. Companies yet to take action on climate change will have to work hard to remain competitive as we head towards an increasingly resourced constrained, low carbon economy."

Alan McGill, partner, sustainability and climate change, PwC said: "Historical financial performance is being exposed by climate change as an outdated model to assess long term business profitability and growth, when you consider the much wider range of financial and non - financial risks associated with business today. Today's investors have different information needs, which are leading to tougher verification regimes, more emphasis on executive and staffing responsibilities and incentives, and much more unforgiving examinations of the contribution of business to society. We are accelerating towards newer reporting models that better balance financial and non - financial performance."

Rising oil prices, energy supply risks and growing recognition of the commercial returns on investments in emissions reduction activities contributed to the growth in importance of climate change as a boardroom issue. Over half (59%) of reported emissions reduction activities delivered payback in three years or less according to company submissions. These include energy efficiency projects (building fabric, building services and processes), low carbon energy installations and staff behavioural change. Employee incentives to reduce emissions are now offered by 65% of companies, compared with 49% in 2010.

 The top 10 best performing companies this year are:

USA: Bank of America, Cisco Systems
Japan: Honda Motor Company, Sony Corporation
Germany: Bayer, BMW, SAP
United Kingdom: Tesco
Netherlands: Philips Electronics
Australia: Westpac Banking Corporation

CDP says there are 14 new entrants to the 2011 Carbon Performance Leadership Index, which counts only 29 companies due to more demanding criteria applied by CDP. These are:

USA: Air Products & Chemicals, Lockheed Martin, Morgan Stanley
Japan: Honda Motor Company, Sony Corporation
Germany: SAP
France: AXA Group, Schneider Electric
Italy: ENEL, FIAT
United Kingdom: British American Tobacco, BG Group, Glaxo SmithKline
Switzerland: Novartis

http://www.bbc.co.uk/news/business-14921740  

And the green terminology winner is....sustainability

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A recent survey by Greenbiz.com has examined what term companies use to best describe their energy efficiency or Green IT projects and initiatives.

For around half of the respondents, according to this report, the magic word used to describe their environmental initiatives is 'sustainability'. The second most used word or phrase is Corporate Social Responsibility, or Corporate Responsibility. Another term that is coming up on the rails is 'resilient', though for me that implies business continuity, not sustainability.

With sustainability in mind, the Dow Jones Sustainability Index annual review has been published. Here are details of the announcement which is good news for Samsung in the technology 'supersector'.    

Those not included in the World Index include Coca-Cola, Hewlett-Packard, and California utility PG&E, while Microsoft lost its place in the North America regional listing. CA Technologies was added to both the World and North American listings.

Green Google: 'our Cloud does more with less'

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Google has just launched a Web page detailing its annual energy use and carbon footprint impact. 

It argues that to provide a user with Google products for a month--not just search, but Google+, Gmail, YouTube and everything else it offers - its servers use less energy per user than a light left on for three hours. And, because it says that it's been a carbon-neutral company since 2007, "even that small amount of energy is offset completely, so the carbon footprint of your life on Google is zero."

There are more details here  

It has also produced a study about powering email using the Cloud

CZS promises a new approach to tackling energy efficiency programmes within organisations

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I was interested to see that the former Head of Sustainability at the Royal Mail, Dr Martin Blake, has set up a new organisation, Carbon Zero Solutions (CZS) to support organisation executives in the deployment of energy efficiency programmes that improve profitability and reduce environmental and social impact.

While at the Royal Mail, Dr Blake was the architect of the Carbon Management Programme at Royal Mail and oversaw a multi-pronged strategy in the areas of energy reduction and efficiency, waste management, water conservation and workplace diversity. The Royal Mail's team of energy experts is credited with reducing UK Royal Mail Group's annual energy bill by over £30million.

According to Dr Blake, "There are many examples of boards that have not pursued the benefits of energy reduction because they are being sold on outputs that cannot be adequately quantified or explained. Too many initiatives have been conceived and implemented in a piecemeal fashion. Individually they may have been effective, but unless taken together within a wider coordinated programme, it is unlikely they will each deliver quantifiable ROI. It is therefore not surprising that some board directors feel ambivalent or wary."

I wonder whether this will set a trend, with successful heads of sustainability leaving their organisations to set up a company, providing energy efficiency services to others. It will be interesting to see how this approach develops.

The CZS website says this about carbon reduction plans within organisations.

"Too often carbon reduction is hived off into a specialist function from where only incremental savings in energy costs can be made. At CZS we believe businesses could be more ambitious. We understand the importance of getting key stakeholders onboard and engaging the wider workforce. We are familiar with the many reasons to resist change and understand why some organisations remain fixed on 'business as usual' strategies. However, only when there is top down leadership, able to harness the intellectual capacity of an organisation, can the full potential of a business be realised."

 


 







Green policy wranglings begin to emerge within government

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It seems as if with the party conference season not far off, a row is brewing over the government's energy policy, which may have some implications down the line as far as business energy costs and climate change legislation are concerned.

It follows a leak to the Daily Telegraph of a note to David Cameron  discussing the impact of energy and climate change policies on energy prices, Although the focus of the letter is on consumer energy prices, it is possible that a wider review may also need to examine the effect of government policies in the form of climate change legislation on businesses.

The letter suggests that four policies stand out as having the most significant impact on household energy bills: carbon pricing (both our own carbon price floor and the EU emissions trading scheme), the new Energy Company Obligation, the Electricity Market Reform package and the Renewables Obligation. It goes on to ask whether policies can be opened up, particularly support for relatively high-cost technologies such as offshore wind, in a way that minimises cost and disruption to investment.

There is some more background to the story here:

http://www.businessgreen.com/bg/james-blog/2106683/10s-criticism-decc-lacks-credibility-energy-ideas

http://www.guardian.co.uk/environment/damian-carrington-blog/2011/sep/05/greenpolitics-energy

 

 

 

Corporate sustainability strategy: now part of the CFO's remit

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Sometimes it seems as if corporate responsibility within the organisation for sustainability strategy is being passed around like a relay baton.

So far, those touched with responsibility for sustainability include the corporate social responsibility (CSR) team, marketing (because of the future brand and reputation implications in the UK of the Carbon Reduction Commitment (CRC) league tables), IT and Facilities who are having to manage and measure energy usage, and in theory, the CEO who should surely know the big picture at least.

Now, an Ernst & Young report, 'How Sustainability has Expanded the CFO's Role', recommends it is also the CFO's turn to pick up the baton, because, in the US at least, as Triple Pundit explains, sustainability trends are shifting the role of the CFO into three key areas:

  • Investor relations:  "Shareholders are speaking much louder and much more stridently than they did just a few years ago.  During the 2011 proxy season, 40 percent of shareholder resolutions were related to ESG issues. And over a quarter of ESG-related resolutions gained a 30 percent "Yes" vote, which Ernst & Young describes as a critical threshold (other observers say anywhere from a 10 to 20 percent vote can motivate companies to rethink their policies).  Mutual fund companies are paying more attention to sustainability related issues, and the rating companies are directing more focus towards ESG matters as well.  All this leads to a shift in the duties of companies' investors relations staffs; and CFOs, according to Ernst & Young, will lend more than a few hands with the demands placed on IR departments.
  • External reporting:  More than 3000 multinationals issue sustainability (or CSR or ESG) reports, and many of these companies now provide more than static or trite glossy PDFs. Companies including UPS, Timberland, and Microsoft are raising the bar in offering frankness while encouraging increased stakeholder engagement.  To that end, more companies are having their sustainability reporting audited by third parties (such as the Carbon Disclosure Project for carbon emissions performance).  And that experience with third party performance falls into the CFO's lap because they know how to balance the challenges and opportunities that arise from third-party verification.
  • Operational controllership and financial risk management:  Early last year, the US Securities and Exchange Commission issued guidelines to companies on how to disclose risks possibly related to climate change.  Carbon data, and more frequently, water data, is becoming financial data because of these resources increasing price.  What was once tangential to the costs of running businesses has and will be central to the financial risks that come when running a company.  Whether evaluating the costs of large capital projects or ascertaining the reliability of sustainability data, CFOs and the departments they head will be careful when ensuring that all this data is accurate."

Five suggested actions that CFOs can take to enhance corporate value through sustainability include the following:

• Actively pursue a sustainability and reporting program.
• Ensure that those responsible for sustainability matters do not operate in isolation from the rest of the enterprise -- especially the finance function.
• Enhance dialogue with shareholders and improve disclosure in key areas, particularly those related to social and environmental issues.
• Ensure that directors' skills are relevant to the chief areas of stakeholder concern, including risk management tied to social and environmental matters.
• Consider using nontraditional performance metrics, including those related to environmental/sustainability issues.

 

Knowing which carbon compliance scheme you fall under

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Just a short line about a tool I came across from Carbon Guerilla which has produced a useful graphic for organisations to see where their compliance lies.

As Carbon Guerilla director Mark Clayton says, deadlines are concentrating minds, and in terms of finding ways through the various elements of legislation, this flowchart might be useful in the future for deciding whether you're affected by CRC (the Carbon Reduction Commitement Energy Efficiency Scheme), a CCA (Climate Change Agreement) or the EU ETS (European Union Emission Trading Scheme)

 

Using IT to focus on reducing excess inventory and improving sustainability

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A recent blog post on the Harvard Business Review has raised the issue of inventory, its impact on sustainability, and what IT can do about it.

The piece, by Andrew Winston highlighted organisations' previous inability to do much about their estimation processes, and what the consequent excess inventory's impact is on sustainability,

Winston suggests that the world is sitting on roughly $8 trillion worth of goods held for sale.That's $8 trillion worth of embedded environmental footprint, which could be reduced, saving money, energy and material.

The problem is that when it comes to managing inventory levels, organisations are falling down on demand planning i.e.predicting how much product customers want. As Winston points out, consumer product goods (CPG) companies spend a fortune on demand planning. And they have to: P&G's 2010 total inventory, for example, was valued on the balance sheet at $6.4 billion. 

Effective use of IT can play a significant role in making operations more efficient and sustainable. Winston suggests that using both demand sensing software and good management practices has helped P&G cut 17 days and $2.1 billion out of its inventory, saving money in manufacturing, distribution, and ongoing warehousing - and carbon, material, and water.

You can read the complete piece here


 

GE goes Platinum with pioneering green data centre

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There has been much coverage of GE's unveiling in the US of a new pioneering "green" data centre, built on the original site where the world's first commercial computer was deployed in 1954.

The new data centre, developed by GE's IT department is based at GE Appliances & Lighting in Louisville, Kentucky.

 

The data centre is one of the world's first to achieve Leadership in Energy and Environmental Design (LEED) Platinum Certification, a rating awarded by the U.S. Green Building Council for projects that go above and beyond standard building codes to create sustainable, energy-efficient buildings.

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To get the Platinum rating, GE ensured the data centre hit a few targets:

 

  • 98.3% of the walls, floors, and roof were existing space that didn't require new construction
  • The data centre is 34% more energy-efficient than a comparable code-compliant building
  • It reduces by 50% the amount of space used by the previous data centre by using high-density servers
  • Water consumption inside the building is being reduced by 42% of the industry baseline by using ultra low-flow fixtures
  • 50.7% of construction materials were sourced regionally
  • 30.2% of the building materials were recyclable materials
  • 85.4% of construction waste was diverted from the landfill (mostly through recycling)

 

http://www.gereports.com/new-ge-appliances-lighting-data-center-opens-wins-rare-platinum-leed-certification-for-energy-savings-and-sustainable-features/

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