CIO: Kevin mentioned the emergence of carbon limits and carbon trading. What do IT organizations need to do to prepare to operate in an environment where carbon emissions are capped?

Douglas: Any government-led management scheme designed to drive down carbon will involve limits or taxes of some kind. In either case it’s hard to imagine a scenario where end-user energy prices don’t rise. Electricity prices rose 30 percent to 60 percent in Germany following the institution of a CO2 cap and trade system. What that means is that people have to start paying attention to where their data centers are, what their power options are in those locations, and what the CO2 content of those options is. Generally, the higher the CO2 content of your electricity, the more exposed you are to cost increases due to future CO2 reduction schemes.

Adams: The key to consistency in the way energy and carbon are tracked and reported will be the creation of one set of standards by the federal government. In the best of all worlds there would be alignment of industry, government, researchers, vendors and non-governmental organizations as the standards are being created.

CIO: Finally, what are the next steps organizations need to take to get energy efficiency to the next level?

Douglas: Whoever you are, the place to start is to understand where your current energy use is, and start to look for cost-effective ways to reduce it. There are a lot more elegant and advanced things to do, but this first step is never a bad idea.

Koomey: Many new technologies can enable emissions and cost savings, but implementing those innovations will require both technological and institutional innovation. For example, cross-functional teams with high-level authority (like some companies create as part of their Six Sigma implementations) can often cut through departmental hurdles and identify, implement and track cost- and emission-saving innovations more effectively than people within specific departments can. Most companies don’t have such cross-departmental teams, but teams of this type can facilitate the adoption of new cost- and emission-saving technologies and processes.

Sometimes perverse incentives get in the way of minimizing total costs. Then companies need to be reorganized. For example, when IT budgets and facility budgets are separate, data centers are vastly less efficient than they could be, and total costs of ownership cannot be minimized effectively. The CFO needs to demand financial accountability from all parts of the organization so costs can be reduced, and that accountability will likely require reorganization.