Economy or Ecology? What does 'Green' really mean in the context of business in a free market? Have companies become more altruistic in the wake of 'An Inconvenient Truth' and $4+/gallon gasoline? I think not, though I would love to hear your feedback.....
Those of us who buy into global warming, the emerging energy crisis, and the implications of overconsumption to our collective well being (full disclosure - this includes me) want very much to believe that companies will and are wholeheartedly investing in Green processes, technologies and products. To a degree, this is true. But micro-economic theory simply does not support the notion of investing in Green for the sake of Green, absent some perceived profit or other tangible benefit to the owner's of the company.
Over the past couple of years much has been made of Man's impact on global climate change and messages about unsustainability of current standards of living appear virtually every where I look. To a large degree, Al Gore's 'An Inconvenient Truth' has had exactly the impact that he intended; 'Green' has become an integral part of daily conversations and general cultural awareness for most of us.
But how much of this is truly resulting in changes to the way corporations and (specifically) IT organizations make decisions and do business, and how much is plain old capitalistic 'green-washing' to increase product desirability and subsequent sales? Has 'Green-think' changed the fundamental business decisions that corporations make or is it business as usual with 'Green' as a nifty new catch phrase added to processes and products in order to change the perception of value and accomplishment?
Data Centers make up one of the most rapidly growing energy consuming sectors of the global economy and also represent large investments for most corporations. 2005 data from studies conducted by the EPA and Lawrence Berkeley National Labs estimate data center energy consumption at some 1.2% of the world's energy production. The data also indicates that consumption has doubled between 2000 and 2005 and accelerate based on the sheer amount of data center capacity being added to support the explosion in Internet content and services. As a result, a great deal of discussion has occurred regarding making data centers 'Green'. But is the growth in data center energy consumption alone sufficient to cause companies to pursue energy efficient design and procurement strategies? Most likely, the growth in consumption is insufficient motivation for changing the way companies design and operate data centers.
Other data published by the Uptime Institute indicate that we are, or soon will be at a point in time where the cost of energy consumed by a server over its depreciable life is higher than the capital cost of purchasing that server. If true, this is much more likely to change current practices since there is a direct impact to profitability! To the extent that energy costs impact profit, corporations are highly motivated to change and to the degree that these profit motivated improvements align with the Green agenda (i.e. energy efficiency), we will in fact, begin to conserve energy and consequent carbon emissions.
Absent profit motives, only regulation will bring about the pursuit of Green practices. Welcome to free enterprise!
Comments, Questions, Criticisms?