‘Going Green’ through Cloud

Monday, August 1, 2022

Today, across the globe, companies have been vibrant in discussing the importance of sustainability as a key constituent of their strategy (CSR – Corporate Social Responsibility). The importance of Green initiatives of any nature holds immense value, that is undeniable. Likewise, Cloud has been a topic of interest that has gained momentum during the past few years and the derived benefits are still being debated by many. Keeping aside all the cost benefits that a company can accrue by moving to the Cloud, I strongly feel that it is much more interesting/beneficial to understand the sustainability benefits made possible through Cloud adoption.

How much does the ICT (Information Communication and Technology) sector contribute to the global GHG (Green House Gas) emissions?

I felt that before venturing into the green benefits offered by Cloud adoption, it is beneficial to have an understanding regarding where the ICT sector stands today when it comes to the GHG emissions. The 2012 report released by the global consulting firm BCG estimated that the total emissions from ICT in 2011 were at 0.9 GtCO2e (1.9% of all global GHG emissions). By 2020, the total emissions would reach 1.3 GtCO2e (Giga Tonnes of Co2 Estimated), or 2.3 % of global emissions. To anyone, the increasing emission trend would pose a concern but the very slight percentage of annual increase offers a slight relief.

ICT enabled GHG reductions

It is estimated that the global GHG reductions by adopting the right ICT techniques is ~ 9.1 GtCO2e and the industry-wise reduction estimates are as seen below. For example, it is evident from below that ICT enabled GHG reduction for the Power sector is at 2 GtCO2e while for Manufacturing it is at 1.3 GtCO2e.

Cloud as an ICT strategy to reduce GHG and improve costs

Having gone through the preceding sections, it is now quite clear that the ICT sector offers immense potential to global industries and sectors to reduce their Carbon footprint. How much green benefit would Cloud as an ICT strategy offer companies is worth having a look. A recent study by the Carbon Disclosure Project (CDP) shows that by 2020, U.S. businesses with revenues over USD 1 billion could realize energy cost savings of up to USD 12.3 billion and annual CO2 emissions reduction of 85.7 Mt by spending 69% of infrastructure, platform, and software budgets on cloud services. In reality, in common man’s language, a global CO2 reduction of this scale is possible only if 16.8 million passenger vehicles are taken off the road.

Financial/Business case (vs) Environmental case for Cloud adoption

All said and done, based on the above, to me one question that prevails is whether companies planning to adopt Cloud should weigh more towards its financial incentives or the benefits the technology extends to the environment. In my personal opinion, there shouldn’t be a second thought to consider Cloud technologies having understood its environmental impact in terms of Co2 emission reductions. If one realizes that there are multiple ways of earning profits but it’s our moral responsibility to embrace Green technologies, there would not be any need for further incentives to prompt companies to join the Cloud bandwagon. If global authorities and governments could design incentive plans similar to the Carbon trading that existed until a few years ago, then the uptake of Cloud technologies by companies irrespective of all the current confusion would grow rapidly.

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