By Sundeep Khisty

The world's leading analysts predict that energy costs will be eating up more than a third of IT budgets within the next five years. 

Global warming has emerged as the critical issue of the 21st Century. While governments worldwide debate the best formula to cut greenhouse gas emissions, change is inevitable.

Most world leaders concede that global warming is the fault of human kind and that intervention is a priority.

A recent report by the Intergovernmental Panel on Climate Change (IPCC), left little doubt on the issue. Drawing on work by 2500 scientists, the UN-backed IPCC concluded that it was more than 90 per cent likely that recent warming has a predominantly human cause.

The global community agrees that carbon emissions must be reduced, but there is no consensus as to how much and by when. While some countries have set targets, others, including Australia and New Zealand, have implemented initiatives to support industry greening programs.

In Australia, the Federal Government has introduced Greenhouse Challenge Plus for Australian companies to form working partnerships with the Commonwealth on improving energy efficiency and reducing carbon emissions.

The initiative includes an electronic emissions reporting system called Online System for Comprehensive Activity Reporting (OSCAR) to monitor progress and benchmark success. There is independent verification of results, with participating companies eligible for Greenhouse Friendly^TM Certification.

Such recognition allows Australian businesses to market greenhouse neutral products or services, deliver greenhouse gas abatement, and offer a point of difference to consumers.

New Zealand has a similar program introduced as a result of the Energy Efficiency and Conservation Act, which provides a legislative basis for promoting energy efficiency and conservation, and renewable energy.

Companies that join the NZ Landcare Research administered program aim for carboNZero certification. Independent verification demonstrates the accuracy of the information and strengthens its credibility.

While participation in such initiatives is voluntary, governments are expected to introduce tougher measures in future. Carbon tax legislation is likely to be on the agenda, and no industry is expected to escape regulatory changes.

From July 1 this year, a number of Australian companies will be obliged to start reporting on their energy use and carbon emissions, under the new National Greenhouse and Energy Reporting Act. But the real issue goes beyond simply collecting data. Though data collection is likely to create demand for a more sophisticated IT infrastructure - or services to that effect, to enable it, the real issue, of course, is the one of reducing carbon emissions and energy consumption themselves.

The explosive demand for computer, data storage and network resource requirements in recent years has already put a significant pressure on organisational IT requirements.

Processor performance is now inexpensive and servers are relatively cheap. As a result they are more in number, but heavily underutilised. This over-provisioning of IT assets is made worse by technology infrastructure that is too rigid and complex to be responsive and efficient.

Then there is the issue of power consumption. IT systems are major energy users, particularly traditional data centres which require significant power and cooling capacity for high-density equipment.

According to Gartner, the IT and communications industry now accounts for about two per cent of global CO2 emissions, which is similar to aviation.

The Bigswitch project says data centre power consumption is running at between 15 per cent and 40 per cent of total office tenancy consumption, which equates to an estimated 0.11 per cent to 0.48 per cent of all Australian greenhouse emissions.

With energy prices increasing due to a shortage of generation and ever increasing demands, IT running costs will continue to rise. Gartner estimates that power and cooling needs could increase from 4-10 per cent of the IT maintenance budget to up to 50 per cent, if the trend continues.

Gartner predicts that by 2008 half the world's data centres will have insufficient energy to meet the power and cooling requirements of high-density computing equipment.

It also warns that power hungry hardware and rising global fuel prices may lead to energy costs eating up more than a third of IT budgets within the next five years.

Forecasts from analyst firm IDC show a similar trend. IDC estimates about 50 cents is currently spent on energy for every dollar of computer hardware  over its life. This is expected to increase by 54 per cent to 71 cents over the next four years.

The world's leading analysts paint a grim future without immediate action. It is essential therefore that businesses plan their IT infrastructure with a clear focus on energy efficiency.

Sundeep Khisty, Environmental Sustainability Services Manager, EDS Australia & New Zealand

A major player in the Australian global services market since 1985, EDS Australia employs a workforce of more than 6,000 people and maintains offices in Sydney, Adelaide, Melbourne, Canberra, Brisbane and Perth. Focusing on the financial services, communications, government and consumer, industry and retail markets, the company offers the full spectrum of IT services, from information-technology, applications and business process services, to information-technology transformation services.