Green adds bucks to corporate savings

Cost-reduction initiatives tagged with green IT benefits provide more reasons for businesses to implement such tools, says analyst.
Written by Sol E. Solomon, Contributor

While reducing costs may not be the primary reason some companies in Asia choose to go green, there are loads of savings to be gained for businesses that are environmentally friendly, say analysts.

John Brand, research director at Hydrasight, noted that until recently, the primary objectives for organizations to go green were driven by organizational marketing efforts and increasing focus on corporate social responsibility.

"However, cost reduction projects can often be tagged as having 'green benefits' in order to make them appear more attractive," Brand said in an e-mail.

Michael Warrilow, managing director of Hydrasight, noted that green efforts to cut operational expenditure can come in several forms. Reduced power and cooling efforts at data centers are some of commonly-cited examples of green IT initiatives that can save costs, Warrilow told ZDNet Asia in an e-mail.

Green IT tips

1. Define a policy and strategy outlining the impact of IT on the environment. This includes electronic waste, asset disposition, consumption of non-renewable resources and user behavior.
2. Measure and analyze monetary and environmental costs.
3. Switch off client systems such as PCs, when not in use.
4. Challenge 24 by 7 requirements for system availability.
5. Consider green printers and printing.
6. Reduce IT cooling and power loads at data centers.
7. Look at green purchases in procurement.
8. Establish an asset disposition policy.
9. Encourage employees to adopt green measures.
10. Address the environmental impact of IT on the company and its supply chain operational processes, including energy consumption and waste emissions from manufacturing. Also, note the impact of the company's procurement and use of IT products and services.
Source: Gartner

Philip Carter, IDC's Asia-Pacific green IT lead and associate research director, added that going green can also help companies save money without having to spend more, for example, through better paper management and business processes.

Not all green measures come free, though, such as the consolidation of data centers, which requires some upfront costs, and additional investments in software, services and data migration. However, Carter said in a phone interview, the financial payback can be significant.

Teow Bee Kim, Asean general manager of IBM Global Financing, noted that with the cost of energy rising, power and cooling increasingly comprise a large and growing percentage of the total cost of ownership.

Gartner, for instance, estimates that high-density blade servers can consume up to 15 times more electricity than traditional servers. According to U.S. researchers at the University of Michigan, idling servers and strict service level agreements at data centers increase power consumption by 50 percent to 100 percent.

In fact, the cost of powering and cooling an installed server base will be equivalent to 50 percent of actual spending on new servers in 2008, said Tony Parkinson, vice president of enterprise storage and servers at HP Asia-Pacific and Japan. Citing IDC figures, Parkinson added that power and cooling costs are anticipated to reach 66 percent of new server spend by 2011.

He noted that CIOs in the region are already actively considering power-saving capabilities of new technologies to cut costs.

Teow said in an e-mail: "In the face of these cost pressures, by consolidating multiple applications and workloads on many virtual servers in individual physical machines, they can establish a new level of data center power control and make a significant dent in their energy bills."

According to Warrilow, anecdotal evidence suggests more efficient utilization of server hardware can save a company about S$800 (US$527) on power per physical server, per year.

The University of Michigan researchers also tout energy-conservation and efficient power supply methods, such as PowerNap and Redundant Array for Inexpensive Load Sharing, that can help cut energy consumption by up to 75 percent.

Parkinson added: "To achieve an energy-efficient infrastructure, enterprises do not have to sacrifice computing performance for energy efficiency. They can have both."

Vendors offer green schemes
And more IT vendors are now looking to fulfill that demand, including Dell Computer, HP, IBM and Sun Microsystems, which all offer products and services designed specifically to consume less energy and be reusable, including servers, printers and desktops.

Dell, for example, peddles servers that can provide US$200 per year in energy savings, while HP pushes desktop PCs that it says can cut power costs by up to US$58 per year.

The latter itself runs a company-wide green initiative. In its financial year 2008, HP chalked up 6,528 tons of recycled hardware and supplies across the Asia-Pacific region, an 11 percent increase over the previous year. The vendor is also targeting to recover an additional 1 billion pounds, or 500,000 tons, of hardware and supplies for reuse and recycling by end-2010, Parkinson said.

Teow advised clients evaluating new hardware products to insist on including disposal options in their discussion with the vendor, as part of the selection process.

Warrilow said: "While it may be argued that a disposal policy is simply 'outsourcing' or 'delegating' the problem to a third-party, purchasing is undoubtedly the best time to motivate a hardware vendor, because that's when you have their full attention."

But, simply outsourcing the effort does not necessarily mean outsourcing responsibility, he noted.

"We recommend that organizations gain independent certification of appropriate disposal in addition to simply negotiating disposal requirements," he said. "Companies often require certification of disposal as they can be held accountable for disposal of hazardous or contaminated waste products, even if the responsibility is handed over to a third-party."

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