Call Center Services, Outsourcing Services, Outsourcing Projects
A while ago I wrote a blog on sustainability and how it might provide BPO vendors a competitive advantage. I see a lot of activities within Europe and U.S. in that area and thus wanted to share some of my observations. Especially on how technology will increasingly be an enabler of increased energy efficiency. A topic which is also becoming of increased importance to offshore BPO vendors with fuel and other commodity prices going through the roof.
The Netherlands has traditionally a leading position in agricultural (Tulip anyone?), but due to the climate many crops are grown in greenhouses that have to be heated during winter. The engines used run on gas and the resulting heat and carbon dioxide are used to create the optimum growing conditions. These ‘micro combined heat and power engines (Micro-CHP) produce also electricity however, and much more than needed to provide artificial lighting during the night hours. One options to feed the access power back to the grid or to feed it directly to nearby houses and company buildings. One such initiative includes using the power of 35 engines used to heat 220 hectares of greenhouses to power a new datacenter. The access heat produced by the datacenter is in turn fed back to the greenhouses. This initiative is an example of the increased emphasis on sustainability within many industries and at the role of technology as an enabler (e.g. smart grid).
Reducing the environmental footprint of information technology has its origin in the Energy Star initiative launched by the U.S. Environmental Protection Agency in 1992. Through this program manufacturers of energy-efficient monitors and other equipment could distinct themselves from less environment-focused competitors. Since then, ‘Green’ has seen a steady rise on the priority list of governments and companies all over the, including the implementation of legislation. In the United States the American Recovery and Reinvestment Act (ARRA) legislation allocated $90 billion to be invested in projects aimed at improving the energy efficiency of IT itself (‘green for IT’) and the use of information technology to increase the level of sustainability within other industries and the society as a whole (‘IT for green’).
In France and Australia the adaptation of more efficient technologies is pushed by the government by the introduction of a carbon tax. In France companies with more than 500 employees have to report on their emissions and take action to reduce them and in Australia a ‘cap and trade’ system will be implemented by 2012. For the European Union as a whole both new legislation is underway and funds are freed for initiatives like Green Active Management of Energy in IT Service centers (GAMES). It is a research project aimed at developing best practices, methodologies and supporting tools to improve the energy efficiency of future data centers. Other organizations focus on creating standards and guidelines. Some more generic standards are:
Besides these generic standards there are also many aimed specifically at technology. Some are directly related with the manufacturing of the components while others focus on the deployment of them.
Even though initiatives to increase the power efficiency of data centers and IT systems in general can have a substantial impact on both the environment and the electricity bill, are the largest (future) gains in be expected in the area of IT for Green initiatives. By implementing smart meters in houses, local CHP systems, supply chain optimalization or teleworking, scarce resources are used more efficiently. These technologies are often combined with initiatives to better inform consumers on their usage patterns, enabling them to change their behavior and thus benefits of the technology. the website Trackulous allows consumers to track their own impact on the environment, while GreenScanner provides information on the environmental impact of products . Information which will get increasingly detailed and complex with the introduction of Life Cycle Assessments. These kind of assessments allows companies to determine per phase in the value chain both the current impact on the environment, and the potential benefits that can be achieved.
The adaptation rate of green technology will in the end however be determined by the price and the value of the efficiency gain it enables. The illustration shows the relationship between the price of the more environmental friendly product and the number production volume required to become a competitive substitute for existing technologies. It shows that new technologies (e.g. ‘green’ data centers) can initially be substantially more expensive than established ones, but that initial support (e.g. ARRA funding), legislation and carbon tax can even the odds quickly for newcomers. This combined with the rising prices for fuel , raw materials and almost any other commodity, the value of the efficiency gains offered by new technologies will push the economic breakeven point increasingly to smaller production volumes.