It’s Not Easy Being Green [1]: The Tech Industry Seeks Greener Solutions to Its Rapidly Increasing Energy Demands

by Justin Eurek September 24 2007, 15:45

I.  Introduction  
Why do companies go green?  A cleaner, more efficient energy solution certainly sounds progressive and looks great on paper, but aside from generating good public relations with environmental groups, is it an economically sound investment?   In the case of the tech industry and its rapidly increasing energy costs and demands, it may be their only option.  Put another way, the answer may be a resounding "Yes."

To illustrate this problem, take for example the ubiquitous IT data center, or the air-conditioned computer farms found at the heart of almost any large technology firm.  [2]  They offer increasingly more complex and useful applications, web pages, internet traffic and processing power, but at significantly increasing costs.  [3]  Data centers are massive energy consumers and may require as much as fifty times the power of a comparably sized office space.  [4]  Despite some recent notable improvements in hardware power efficiency [5], the Environmental Protection Agency (“EPA”) released a report on August 7, 2007 that projected the tech industry’s overall electricity consumption to double between 2006 and 2011.  [6]

II.  The Green Factors
Several key factors are driving the accelerated effort to convert to "greener" energy solutions including rising power demands, increasing energy costs, and government mandated energy efficiency policies and economic incentives.  [7]

A.  Increasing Power Consumption and Energy Costs
The consumption of energy in data centers, for example, involves as little as 30 percent of the total electricity consumed to actually run the computers.  [8]  The remainder is largely reserved for the industrial air conditioning that cools the densely packed rack-mounted servers down to approximately 40 degrees to ensure that no single server's temperature ever rises above its optimum level for maximum performance.  [9]  Power consumption and usage inefficiencies are rampant in an industry that historically turned a blind eye to the environmental footprint until it started affecting their bottom line.  [10]

The technology sector as a whole is seeing power consumption rise rapidly, with the IT industry consuming roughly 61 billion kilowatt-hours, which amounts to a roughly $4.5 billion cost, as reported by the EPA in 2006.  [11]  This amount is expected to double by 2011.  [12]

B.  State and Federal Energy Policies and Economic Incentives
California has enjoyed an accelerated growth of the clean technology sector in Silicon Valley due to the state’s clean tech backing policies.  Because of this, it has quickly become the U.S. leader in state-sponsored energy incentive programs.  [13]  For example, California has created incentive programs to increase the use of solar panels on homes in an effort to help achieve a 25 percent reduction in greenhouse gas emissions by 2020, and requires that public utilities must generate 20 percent of their electricity from renewable resources by the year 2010.  [14]

Though California trailblazes state-run initiatives for the conversion to green power, the federal government has also contributed to the effort.   The EPA offers financial incentives, including tax credits and utility rebates, to help expedite the tech industry’s segue into greener power solutions.  [15]

III.  Green Solutions
A.  Existing Technologies

While the utility and tech industries seek out new and more efficient technologies, some efficiency reducing solutions already exist and are being implemented.  The EPA estimates that the easiest and least expensive changes to data center operations (including tweaks to the software, the server layout and air conditioning), could increase efficiency by as much as  20 percent.  [16]  While these changes alone will provide substantial savings, it will not offset the 45 percent reduction necessary to lower overall electricity usage by 2011.  [17]

A number of data center components are currently being manufactured that are robust enough to withstand sustained ambient temperatures of 122 degrees Fahrenheit.  [18]  This could eliminate the need for the massively power-hungry cooling systems, resulting in data centers that are hundreds of times more efficient.  [19]  Companies like IBM, Sun, and HP are currently spearheading this clean technology effort to one day offer technological solutions to realizing self-sustained, no-outside-cooling-necessary data centers.  [20]

B.  Alternative Solutions
While the technology sector searches for ways to increase power efficiency and reduce their environmental footprint, the utility industry is seeking cleaner and more affordable alternatives to the use of fossil fuels.  [21] A wide array of new and innovative alternative energy sources are coming to the forefront in the push for greener renewable resources. 

Wind energy, though currently only comprising a half of a percent of total U.S. energy consumption, is the fastest growing source of renewably energy in terms of usage and capacity due to its remarkable cost per kilowatt of producing electricity [22], green power mandates and federal tax credits.  [23]  The Energy Department expects wind generated power to reach 46.2K megawatt hours this year, constituting greater than a 300 percent increase from 2004.  [24]

Other innovative technologies are emerging as viable renewable energy resources.  These include solar, fuel cells, clean coal [25], extracting liquid natural gas from landfill waste, harvesting wave energy [26], and smart grid technology (an intersection of information technology and energy distribution).  [27] There are even more exotic solutions like bioengineering yeast cells to consume sugar and excrete biofuels [28], harnessing lightning, and even creating man made tornadoes to theoretically produce as much energy as a nuclear power plant.  [29]  The future of green technology is remarkably rife with innovation and outside-the-box thinking. 

The Future of Green Energy
Silicon Valley is experiencing a boom, commonly referred to as “Boom 2.0”, in the number of green-tech start-ups that are developing environmentally friendly technologies.  [30]  Venture capital firms nationwide have invested $2.9 billion into these clean, green technology start-ups in 2006 alone, constituting a 180 percent increase from 2005.  [31]  Investments are projected to increase to $8.7 billion by 2009.  Most IP attorneys involved in green technology say clean technology is here to stay, regardless of the relative price of oil which has driven its popularity in the past, and are reporting an impressive increase in patents and licensing in the clean tech sector with no end in sight.  [32]

Conclusion
With the advent of rising energy costs, increasing usage demands, and mounting regulations by state and federal legislatures to force corporations to convert to renewable energy sources to meet progressively tighter environmental regulations, companies are forced to adapt by investing in cleaner energy alternatives. 

The EPA and the current state-of-the-art of clean technology offer solutions to significantly improve energy efficiency in IT data centers to help achieve lower energy consumption amidst a climate of increased technological usage.  Furthermore, with rapidly increasing investment in clean technology research, innovation, patents, and licensing, the energy sector is primed to manage the rigorous energy demands of the future in the most economically feasible and environmentally friendly manner.  The “green movement” has had a slow and somewhat turbulent beginning, but from here on out it looks like blue skies.

[1]  JOE RAPOSO, BEIN’ GREEN (Jonico Music, Inc. 1970).   

[2]  cnn.com, Tech Companies Are Greener, But Are They Green Enough?, Sept. 12, 2007,http://www.cnn.com/2007/TECH/biztech/09/08/tech.green.credentials.ap/index.html (last visited Sept. 22, 2007).

[3]  Id.

[4]  Id.

[5]  Id.

[6]  Xenia P. Kobylarz, How Green Was My Valley, Mar. 2007,http://www.ipww.com/display.php/file=/texts/0307/green (last visited Sept. 22, 2007); Chris Preimesberger, How Green is IT’s Future?, Aug. 8, 2007,http://www.eweek.com/article2/0,1895,2168443,00.asp (last visited Sept. 22, 2007).

[7]  See Kobylarz, supra note 6; See Preimesberger, supra note 6.

[8]  msnbc.msn.com, Are Tech Companies Really That Green?:  U.S. Firms Tout Their Credentials, But Significant Improvements Are Well Off, Aug. 8, 2007, http://www.msnbc.msn.com/id/20180456 (last visited Sept. 22, 2007).

[9]  See cnn.com, supra note 2. 
   
[10]  Wendy Furrer, Companies Going Green With Energy Alternatives:  High Cost of Fossil Fuels Sparks Efforts to Identify Savings, New Markets, Mar. 29, 2006,http://www.msnbc.msn.com/id/12040418/ (last visited Sept. 22, 2007).

[11]  See Preimesberger, supra note 6.   

[12]  Id

[13]  See Kobylarz, supra note 6. 

[14]  Id.

[15]  See Preimesberger, supra note 6.

[16]  See cnn.com, supra note 2.

[17] Id

[18]  See Preimesberger, supra note 6.

[19]  Id

[20]  Id. 

[21]  See Furrer, supra note 10.

[22]  Id. 

[23]  Adam Aston, The State of Green:  Here's a Look at Some Alternative Energy Sources Such As Wind, Solar, and Ethanol and the Challenges Companies In Those Areas Face, Sept. 10, 2007,http://www.businessweek.com/technology/content/sep2007/tc2007096_783345.htm (last visited Sept. 22, 2007).

[24]  Id.

[25]  See Kobylarz, supra note 6.

[26]  Olga Kharif, The Alternatives to Alternative Energy:  Entrepreneurs Look Beyond Solar and Wind, to Algae, Giant Kites, Lightning, Sept. 12, 2007, http://www.msnbc.msn.com/id/20729466/ (last visited Sept. 22, 2007).

[27]  See Kobylarz, supra note 6.

[28]  Id.

[29]  See Kharif, supra note 26. 

[30]  See Kobylarz, supra note 6.  
  
[31]  Id.

[32]  Id.   

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