Government green IT plan punishes players

Craig-Wood: The CRC plan needs reassessment

The government’s Carbon Reduction Commitment (CRC) scheme aims to reduce absolute CO2 emissions from large non-energy-intensive organisations. Datacentres use 2.2­3 to 3 per cent of Britain’s total grid power.

IT is often said to be a key way to reduce carbon emissions, with datacentres
central to any cuts. Yet datacentres are the backbone of UK Plc, vital to the resilience of public services and the competitiveness of UK business.

The CRC scheme is part of the government’s activity to cut carbon emissions
by 80 per cent of 1990 levels by 2050, encouraging users to reduce their energy consumption and adopt efficiency measures.

However, the government’s scheme plans to allocate the entire carbon liability to
the utility bill payer, irrespective of whether the bill payer is responsible for the energy use.

Any organisation that consumes more than 6,000 megawatt-hours (MWh) of electrical energy a year would be part of the scheme. All the electrical (and some other) consumption of that organisation and its subsidiaries would be totalled to represent the carbon consumption of the organisation.

This is equivalent to a continuous load of 685 kilowatts (kW), roughly 500 kW of IT equipment load in a datacentre ­ around 5,000 efficient modern 1U servers (assuming 100W per server).

A poorly run monolithic ‘old school’ datacentre with lots of power and cooling infrastructure, using three to four-year-old servers, might have just 2,000 machines.

The organisation then has to buy allowances to cover its total carbon consumption, just like power generators must under EU directive ETS6. Organisations cannot pass the penalty down the supply chain and encourage customers to reduce their energy use.

It would make no sense to own your own datacentre, and I expect to see a massive increase in datacentre outsourcing. That would be good for my business, but will be detrimental to carbon emissions overall.

Outsourcing a corporate datacentre or entire IT department would result in
the carbon also being outsourced. Carbon dumping would damage company reputations, yet datacentre outsourcing is common.

Also, energy is cheaper on the Continent, so the additional carbon costs could push businesses offshore. Datacentres can be put anywhere. This would have wider implications for UK jobs, as well as data and application security.

Ranked lower for growth
Net emissions for the UK will reduce. Yet rankings in the suggested performance league table would be determined by absolute and relative growth in emissions. Absolute growth would be worth 75 per cent, and relative growth 25 per cent (how did the Department of Energy and Climate Change (DECC) reach these figures?). Any business growth could push an organisation down the table.

For a datacentre, energy consumption is directly related to revenue. The government’s CRC scheme, if it goes into force as it stands, will damage datacentres in the eyes of customers and other industry players ­ just for doing what any good business should do: grow.

Even worse, for companies that are already leading the market in terms of increased energy efficiency, and for which the opportunities for improvement are few, the CRC is quite simply unfair.

Managing improvements
It would have been much better to start out with poor performance and then to artificially manage a slow improvement in energy efficiency in order to maximise the league table position.

Such companies will look significantly worse than their energy-inefficient competitors, and this will surely result in the customers being misdirected to choose and use more carbon-intensive providers.

In summary, the CRC as it stands will encourage ‘carbon laundering’ with the outsourcing (or even off-shoring) of datacentre operations to avoid brand value damage. It will inhibit the growth of one of the UK’s most important business sectors and will encourage end users to use the least efficient providers.

Kate Craig-Wood is managing director and co-founder of managed hosting provider Memset. She is also on Intellect's directorial leadership group on energy and the environment, and a committee member of the British Computer Society's Data Centre Specialist Group (DCSG).