Accelerating efficiency with Observations from the Living ...€¦ · meantime, collaboration both between business and society, and within the technology sector, can be a path to

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Accelerating efficiencyObservations from the Living Progress Exchange

Setting the scene

In addition to creating more efficient products, the information and communications technology (ICT) sector has an essential role in enabling and accelerating efficiency beyond its own walls. Participants considered external factors that could help reduce impacts in parallel with more efficient products:

•Government involvement and public policy were mentioned as drivers to make sustainable operations commonplace. Participants were hopeful that COP211 would trigger long-term policy action, but also agreed that these issues can’t wait for government action. In the meantime, collaboration both between business and society, and within the technology sector, can be a path to progress where government is lagging. Participants pointed to opportunities for collaboration in shared suppliers and value chains, where efficiencies may lie in businesses sharing resources through new tools and the Internet of Things.

Sustainably meeting the business needs of the futureOn December 9 and 10, 2015, Hewlett Packard Enterprise (HPE) hosted the third global online Living Progress Exchange (LPX) in conjunction with GlobeScan. The LPX brings together experts and opinion leaders from business, civil society, government, and academia from around the world to create a dialogue that helps inform how we advance human, economic, and environmental progress. In this text-based discussion, stakeholders called on business of all types to prioritize efficiency, not just in terms of energy but also in natural resources and materials used. In this paper, GlobeScan summarizes the key insights from this robust discussion, with additional perspectives from Hewlett Packard Enterprise.

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“Can’t disagree with policy, but I would submit that we can’t wait for public policy to shape corporate action to reduce environmental impact. There are MANY things individual orgs can do without the prompting of state/federal government.”

– Josh Henretig, Microsoft

“I fully concur that cross-sector collaboration is vital. We share suppliers (auto, electronic, etc.), especially at the tier 3 and 4 levels. This is where a convergence around common tools could elevate the value prop.”

– William Hall, Chrysler

1 The Living Progress Exchange was hosted during COP21, where world governments negotiated—and subsequently adopted—the historic Paris Agreement under the United Nations Framework Convention on Climate Change.

Table of contents2 Setting the scene

4 Energy 4 Energy efficiency4 Facilitating renewables adoption

5 Natural resources

6 Pricing models

7 Hewlett Packard Enterprise perspectives

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•Uncovering environmental costs is critical to managing efficiency, in terms of both energy and natural resources. Several participants noted that environmental inputs and outputs from operations are often unrecognized costs to business. Building tracking and sensor technology into existing systems to monitor resources can identify inefficiencies. Translating these impacts into monetary terms puts a tangible value on them that help businesses quantify these impacts and provide incentive for more sustainable decisions. Using information from sensors, ICT companies can also provide data visualization for impact measurements to ensure that insights are understandable and can facilitate action.

•Transparency and accountability regarding these impacts also makes sustainability visible to customers. This is especially important for business-to-business (B2B) organizations, whose customers are increasingly prioritizing sustainability in their own operations and look to ICT companies to enable them in meeting their own goals.

“Valuation should be a lever—environmental inputs and consequences have been traditionally ‘off the books.’ The reality is these impacts and dependencies have costs, and applying a cost in monetary terms to these externalities can have a meaningful effect on decision making, encouraging more sustainable models and brands.”

– Jacqueline Jackson, Trucost

“With regard to customer demand, particularly in B2B, I do think it is evolving. ‘Sustainable’ expectations are starting to shift from just consumer demand to the industrial space—and transparency is again key. Our customers are expecting our transparency and continued advancement in sustainability in our operations, as well as in how we help them meet their sustainability goals.”

– Cassandra Garber, 3M

Energy

There is significant opportunity for ICT companies to promote energy efficiency across the value chain to help facilitate transitions to more efficient ways of doing business. ICT companies have an opportunity to reduce their customers’ energy footprint even as demand for computing increases.

Energy efficiencyOne approach to energy management is through increasing the energy efficiency of products—an area that participants in the LPX recognized as having significant potential for the ICT industry. By developing more efficient networks and data infrastructure, ICT companies can enable customers to reduce energy footprints, through:

•Sensor technology that cuts off energy draws when products are not in use

•Smart metered systems that track resource use and adjust performance accordingly in real time

•Increasing efficiency of data centers to reduce energy use and land requirements

Facilitating renewables adoptionParticipants in the LPX highlighted the role the technology sector can play in increasing renewable uptake:

•Advocating for public policy around renewable energy and working with partners to help garner support where governments may lag

•Help speed the transition from fossil fuels to renewable sources by promoting the adoption of renewables in companies’ own operations

•Curb their own energy footprints by increasing renewable uptake in operations

For ICT companies, using renewable sources to power their own operations raises awareness of alternative energy sources and connects the customer with sustainable technology. Building on this connection, technology companies can also help facilitate customers’ wider uptake of renewables by:

•Providing infrastructure for smart grids that use renewable resources when available

•Automatically gathering and applying data insights to energy management

•Helping to manage distributed energy and connect customers to renewable generation

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“We need a smarter grid to manage all the devices that will be communicating their energy draw, etc. And to manage (electric vehicles) as a source of batteries for the grid as a whole.”

– Andrew Winston, Winston Eco-Strategies

“Challenge for tech is product use energy impacts are largely dictated by local energy mix—thankfully, we are seeing big companies investing in renewables to change that.”

– Hilary Young, Trucost

Natural resources

ICT can also play a role in managing natural capital through data and infrastructure. Participants pointed out the role technology can play in enabling more efficient resource use for all industries. By monitoring systems and providing tools for customers to measure and manage data, ICT can help companies:

•Uncover hidden costs in systems that might otherwise go undetected—water leaks in cooling systems, for example, or even Scope 3 and 4 emissions

•Help track natural capital used in technology, and reclaim it at product end-of-life for reuse

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“Invest in data solutions that support other industries in reducing their footprint, as well as focusing directly on the tech sector—e.g., the buildings industry, which is hugely disaggregated and the information about impacts throughout the supply chains is very diffuse. The impact could be as great as just dealing with the tech sector itself.”

– Alex Zimmerman, Applied Green Consulting

Equally important to data measurement is the knowledge of how to quantify and interpret it: Participants in the LPX called not just for data, but for data that is digestible to the average user in a way that is meaningful and can be tracked for long-term returns.

“Application of sensors to more precisely monitor flow of all kinds of capital—human, natural, financial, etc.—in a production system.”

– Chris Guenther, SustainAbility

Participants in the LPX also called for the whole technology sector to embrace circular design, with ICT companies taking a specific role in tracking materials for reuse and recycling. The technology sector can enable others to trace natural capital through connected data systems and the Internet of Things, providing analytics on tracked resource use and overall lifecycle.

“The circular economy…instantly shifts the incentives so that resource efficiency, product longevity, repair, modulization become important to a business. While data analytics and the Internet of Things can drive efficiency.”

– Susanne Baker, techUK

“Technology can improve a brand’s and its customers’ ability to cost-effectively track materials and items through the supply chain and into the use and disposal phases.”

– Justin DeKoszmovszky, Ovo Energy

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Pricing models

Through their networks and infrastructure, ICT companies can enable business to better manage resources by:

•Installing sensors that detect resource leakage and faulty systems

•Tracking system performance over time to identify patterns when resources are not needed

•Applying shared economic principles to make the most of limited resources like space and land

•Implementing smart technology that adjusts to users’ behavior patterns

Once these impacts are identified, businesses can formalize them ‘on the books’ as a monetary cost. This presents a strong incentive for better management of natural resources, and has proven successful in carbon pricing, for example. Translating natural resources directly into business costs can help drive the demand for more efficient technologies—and sustainable energy sources to power them—as a competitive advantage.

“…monetizing environmental costs is so important. It helps businesses compare trade-offs between different impacts whilst also understanding their actual revenue at risk.”

– Jacqueline Jackson, Trucost

“Structure the right set of internal incentives (carbon price, etc.) to drive behavior and demand for the technologies that largely exist to manage energy/carbon/water more effectively.”

– Andrew Winston, Winston Eco-Strategies

Hewlett Packard Enterprise perspectives

ICT has transformed virtually every aspect of business and life. From online banking and securing seats on a train, to life-saving medical procedures and monitoring vital resources. Technology opens new opportunities, provides essential insights, and enables transformative innovation. The rapid rise of mobile technology, social media, and cloud computing has paved the way for anytime, anywhere access that has caused an exponential swell in the amount of data being created and captured in digital form.

All that data is processed, stored, and managed in an increasing number of large-scale data centers around the world. It’s estimated that in 2015 data centers will have used more electricity than the entire United Kingdom, and that figure that could triple by 2020.2

As the participants in the LPX rightly pointed out, there is an opportunity for the ICT industry to reduce the energy use of its products, even as demand for computing increases.

In recent years, we have made strides in reducing the amount of energy and space required by data centers, through innovations like the HPE Moonshot server architecture and the water-cooled HPE Apollo System. Optimized for specific applications, Moonshot servers use up to 65 percent less power and 90 percent less space compared to traditional servers.3 With some specific workloads, some customers are even seeing 90 percent energy savings and 97 percent space savings.4 The HPE Apollo 8000 System uses 28 percent less energy than air-cooled servers, saving up to 3,800 tonnes of C02e annually.5

Further, Hewlett Packard Labs has embarked on an ambitious research and development project to reinvent computing architecture that will enable quantum leaps in performance and energy use. We call it The Machine, and we estimate it will use on the order of 1 percent of the energy per calculation achievable today.6

Yet we recognize that sustainably meeting the data needs of the future means going beyond the energy demands of the data center. As the LPX participants noted, the ICT industry needs to look at supply as well as demand, driving greater renewable energy adoption across, and beyond, our industry.

That’s why collaborative efforts, like BSR’s Future of Internet Power and WWF’s Renewable Energy Buyers’ Principles (HPE was a founding member of both) are so essential in helping ICT companies and others navigate the renewable energy options. As more and more ICT companies make commitments to purchase renewable energy, as Hewlett Packard Enterprise did through a 12-year, 112 megawatt Power Purchase Agreement with SunEdison in 2015, renewable energy developers will be able to invest in building more renewable resources, which in turn increases capacity, reduces costs, and feeds more agreements. It’s a virtuous cycle.

We agree with participants that it’s also essential that we use the many advantages of ICT to help companies capitalize on important trends, such as smart utility grids and the Internet of Things (machine-to-machine communications), that offer both compelling market opportunities and the potential for dramatic improvements in environmental performance.

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2 Andrae, A. S. G., Edler, T. On Global Electricity Usage of Communication Technology: Trends to 2030 (and supplemental dataset). Challenges 2015, 6, 117-157; DOI:10.3390/challe6010117.

3 Numbers vary by Moonshot server cartridge and customer configuration; based on HPE internal analysis, as of April 2013.

4 The HPE Moonshot for NoSQL Databases would utilize up to 90 percent less power, use 97 percent less space, and cost 78 percent less than a traditional server environment. HPE Internal testing, compared to a traditional 2U/2P rack server, as of March 2015.

5 HPE internal estimate; savings is per HPE Apollo 8000 system vs. an air-cooled data center with 3 megawatts of IT. An industry-standard sustainability formula was used to derive CO2e savings in tonnes using the KW-hr savings based on real-world data center analysis.

6 Based on internal Hewlett Packard Labs calculations.

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© Copyright 2016 Hewlett Packard Enterprise Development LP. The information contained herein is subject to change without notice. The only warranties for Hewlett Packard Enterprise products and services are set forth in the express warranty statements accompanying such products and services. Nothing herein should be construed as constituting an additional warranty. Hewlett Packard Enterprise shall not be liable for technical or editorial errors or omissions contained herein.

4AA6-4302ENW, February 2016

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We are proud of the strides we’ve made in our sustainability performance and disclosure—leadership that’s been recognized by CDP with Climate and Supply Chain A ratings. Yet, there’s much more work to do. That’s why discussions like the LPX are so valuable in helping us identify the most pressing needs and the greatest opportunities for Hewlett Packard Enterprise to further sharpen our strategy and drive solutions. As we apply the insights from the LPX to accelerate efficiency across our value chain, we will share regular updates on our website at hpe.com/livingprogress and through Twitter @HPE_LivingProg.

As a new company that defines transformation and defies business as usual, we are challenging ourselves and others to solve the tough challenges facing our society. Together, we can accelerate solutions, drive efficiency, and create a more sustainable future for all.

Learn more athpe.com/livingprogress

Engage in future discussions and read the full text of all LPX forums at globescanforum.com/hpe-living-progress