How to cut corporate carbon footprints, energy costs

Energy is expensive. It is costing individuals and corporations increasing amounts of money, both directly in the price of gasoline and electricity and indirectly in the form of rising prices for energy-dependent goods and services ranging from vehicles to food.

And it’s expensive in terms of environmental impact, as the scientific evidence linking the “carbon footprint” of human activities — the amount of carbon dioxide humans worldwide pump into the atmosphere to generate power — to global warming and climate change has become conclusive. With those issues in mind, BT Group has launched a new consulting service in the U.S. and Great Britain to help organizations reduce their carbon footprints and in the process save on their energy costs, based on BT’s own experience.

“Our carbon footprint is 0.6 million [metric] tons. That’s reduced by 60 percent since 1996,” says Kevin Moss, head of corporate social responsibility for BT Americas, the North American division of the telecommunications giant. “We have a commitment to reduce it by 80 percent by 2016. That is very doable. I shouldn’t say that that implies it is easy — it is not.” And, he said, this was accomplished while BT grew its business steadily throughout the decade.

Moss emphasizes that while many of the recommendations BT makes to its customers involve telecommunications services, the consultancy is separate from its main telecommunications business and isn’t a sales arm for BT services. And its strategies don’t involve exotic technologies such as replacing the corporate truck fleet with hybrid vehicles or covering the data center roof with solar cells. Instead it focuses on applying mainstream technologies rigorously in ways that reduce energy use. Only after that’s done, Moss says, should organizations start looking at more exotic approaches, such as moving to green energy sources.

“A megawatt not used always has a greater impact than a megawatt used from green energy,” he says. And it saves the organization more money. Looking into carbon trading should be a final step to account for the carbon footprint that remains after the organization has leaned out its energy use. Carbon trading is more popular in Europe, where companies might be allotted a certain unit of carbon emissions and they can then trade or buy those units as they use less or more of their allotment.

The standard corporate carbon footprint, he says, includes:

— Traveling for business.

— Traveling to commute.

— Logistical operations such as a vehicle fleet, materials control or warehouse operations.

— An office infrastructure.

— A data and network infrastructure

— Other industry-specific items (e.g., oil and gas has pipelines and platforms, the electrical industry has generating stations and a power grid).

Each of these need to be examined for ways to reduce the energy costs associated with them. Some of those are obvious. For example, organizations can reduce the energy cost of business travel by substituting audio- or videoconferencing whenever possible.

An “agile worker” program can help an organization reduce its office infrastructure costs. You can begin by simply analyzing the current situation to improve use of office real estate. “So all the people who are out of the office three days a week because they are sales guys or operational guys don’t need the permanent desk that sits there empty for three out of the five days a week,” Moss says. “What you need for that is an infrastructure that allows them to come in, put a computer on the desk, and they are on the network, plug a PIN number into the phone and it rings as if it is their own.”

The next step, he says, is to encourage telecommuting to increase the number of employees who work from home some days each week, and thus increase the number of people who can time-share office space. This also reduces the overall carbon footprint and other air pollution in the area around the office. Even those who do frequently need to be in the office may be able to move their commuting to non-rush hours or work partial days from home, thus reducing the time they spend in traffic jams.

Commuting isn’t included in a corporate energy footprint, but an active telecommuting program has other direct benefits to the organization. BT in the U.K., for example, has a 98 percent retention rate of women returning to their jobs after giving birth — “skilled employees whom we want to keep,” Moss says — compared with a 50 percent average for the U.K. overall, in large part because the option of telecommuting allows these women to tend to their babies at home while working full time. It also allows an organization to employ skilled individuals who do not live near its offices, giving it a wider talent pool on which to draw.

Data centre temperature increase

“One of the things we have done with our own data centre operations and working hard with our vendors is increase the operating temperature of our data center,” Moss says. The change in temperature is not dramatic. “I think we are talking about going from a temperature that requires people to wear two or three layers of sweaters to a temperature that only requires one,” he says, but it has an impact, and BT has done this with its network switches as well. It also has moved its data centres from AC to DC power and makes liberal use of virtualization to increase utilization of equipment.

Industry-specific measures often take greater creativity. Moss offers as an example a solution it developed for a large beverage retailer in the U.K. that owns thousands of soda-dispensing machines, some of which didn’t need to be restocked on every scheduled resupply appointment. Every day the company sent out trucks loaded with product to refill the soda machines. BT’s solution was to equip the machines with intelligent, wireless sensors that could report stocking levels to the company’s warehouses automatically. This allows drivers to plan their routes to service only those machines that need attention and to stock their trucks with exactly the amount of each product they will need for that day’s run.

The result, Moss says, was a 10 percent cut in the mileage the vehicles drive each week. Additionally, the drivers were able to reduce vehicle loads by 30 percent. “Now a 30 per cent load is not quite a 30 per cent carbon footprint, but the carbon footprint of a vehicle has a dependency on the vehicle’s weight,” Moss says. “That solution saved them a lot of other costs as well.”

Another example is Northumbrian Water, a major British water supplier that maintains a large field force. BT recommended that it equip its field service personnel with wireless PDAs (not provided by BT) to provide better field force management. This allowed the company to reduce the mileage its field force drives by 20 percent while maintaining or improving service levels.

Designing such programs is one thing; implementing them is often another, particularly when they require large numbers of employees to change the way they work and management to accept the idea of allowing their employees to work from home, for example.

BT has done this through an internal PR program. “Our employees know our carbon footprint is 0.6 million tons; they know that last year we avoided 97,000 tons through videoconferencing,” Moss says. “So they can put those figures together and understand what impact this is having on my company as a whole.” That doesn’t mean that all business travel has stopped. “People still get on airplanes,” he notes. But they do so with knowledge of the carbon cost of travel and therefore are more likely to ask themselves, “Is this trip really necessary?” in the words of the old WW II slogan, before they schedule it.

What’s the net effect?

These results sound good, but heavier use of audio, video and data networking has its own ecological as well as operational and capital cost implications. Thus the question of the net impact is valid. Moss says that to the best of BT’s knowledge, based in part on an independent study by a major British university of BT’s internal carbon savings program, is that these changes often yield about a 10:1 decrease in carbon footprint.

“We participated in a study two or three years ago of an organization known as ETNO, the European Telecommunications Network Operators,” Moss says.

Six major European carriers added up their total carbon footprints, which they estimated at the time to be about 1 million metric tons per year, of which BT was probably contributing about 0.8 metric tons at the time. They then estimated the potential effect on total carbon footprint of making six changes in corporate operations across their markets, such as getting 10 per cent of all employees to telecommute, getting a percentage of customers to accept electronic rather than paper billing, and replacing a percentage of business travel with audio- or videoconferences, as well as making those changes in their own internal operations.

“They then added up the carbon savings in all of the markets where they operated doing those things [including all their customers], and it came to just short of 50 million [metric] tons of carbon footprint reduction,” Moss says. That’s the net total after accounting for the carbon cost of the increased network load.

Right now, he says, these approaches are being applied inconsistently. For example, telecommuting is much more popular in Europe than in North America, whereas since 9/11, conferencing has become much more popular in the U.S. than in Europe. But, Moss says, “if the Europeans can telecommute, then the Americans can telecommute. If the Americans can have widespread use of conferencing, then the Europeans can have widespread use of conferencing.”

These and other changes in operational methods based on better use of mainstream computer/communications technologies could result in a great deal of savings in both operational costs and air pollution, with very little net change in corporate operations and virtually no impact on growth.