Should CIOs embrace green energy?

Yes, it's time to talk about going green. Again.

conceptional green energy lightbulb

On the surface, this might seem like an obvious “Yes!” I can hear you yelling at your screen from here. But let’s slow down and take a step back.

CIOs have a limited budget, with lots of existing demands on their financial resources. And, going greener could turn into a political battle. Is it wise to cash-in your goodwill with other members of the C-suite over something as boring as clean air and reducing the risk for cancer?

Let’s see if the showdown with Scrooge McDuck is truly worthwhile.

Green evolution

There’s a risk that an investment in green energy could lead to an unintentional ride on the eco-friendly treadmill. Consider how quickly technology, and especially sustainable energy technology is evolving.

Could you have imagined a few short years ago that Germany would be capable of generating 85% of their energy needs through renewable energy technology?

The pace of change is incredibly fast in the renewable energy sector. For a large-scale enterprise deployment of solar panels, wind farms or more energy-efficient hardware, this rate of change could mean millions of dollars being spent to remain current.

If a Fortune 500 purchased all of the hardware required, and adjusted their policies to be certified as a carbon-neutral company, the ongoing investment in maintaining that certification could be HUGE.

More energy efficient at scale

It’s also important to understand that data centers and other enterprise-grade hardware are becoming much more energy-efficient. In the most recently measured year, data-center energy usage in the United States only jumped by 4%.  

Consider the explosion in both the quantity and size of data centers in the past few years. The cloud is demanding more and more juice, yet energy demands are nearly level.

For cost-conscious CIOs, the reality is that allowing existing technology to run its full lifecycle may be a wiser move. By the time an upgrade is fully warranted for business reasons, the new hardware will most likely push your data centers into the range required to be certified as sustainable by different regulatory agencies and NGOs.

How much is a green certification worth?

Now, here’s where the decision becomes a bit murkier. If you allow your existing hardware to fulfill its natural lifecycle, delaying your firm’s qualifications for various green certifications, will your competitors choose to leave you behind?

Being among the last of the companies in your industry to go green might not sound like a big deal. But, you’d be mistaken. 3 in 4 millennials are willing to pay more in order to purchase goods and services from a sustainable company.

This isn’t surprising, considering that courses like AP Environmental Studies are standard parts of most high school curriculums. Millennials are more aware of climate change than any other segment of the population. And with $200 billion in buying power, it’s not a bad idea to cater to the sensibilities of millennial customers.

CIOs and CMOs join forces

It’s difficult to argue that energy savings will cover the significant investment required for a large firm to meet the requirements to be certified as carbon-neutral. This is especially true if your existing hardware is in the beginning of its lifecycle. So, you probably aren’t going to win very many points with the CFO on an initiative to go green.

But, the CMO may fast become your best friend. It’s very possible that additional revenue from environmentally conscious customers may offset your proposed investment in going green. In fact, if you’re considering the plunge, I would make the CMO your first phone call – assuming you have the figures on cost and timeframe for making energy-efficient upgrades.

You’ll gain insights into how costly the ad campaigns touting your green certifications will be. And, you’ll be better armed to overcome objections from other members of the C-suite.

Going green could be an opportunity for forward-thinking CIOs to lead the company on a path towards lower energy costs and positive PR. But don’t discount the high cost of remaining on the eco-friendly treadmill.

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