In 2012 the Information and Communications Technology (ICT) industry consumed 4.6% of worldwide energy and their energy usage was growing more than 2.5 times faster than global energy consumption as a whole. The explosion of computing devices, servers and networking capacity is accelerating the growth in ICT’s energy consumption despite improving energy efficiency on a per-workload basis.
IT efficiency solutions present real opportunities, and payback easy to predict. Code efficiencies alone should be attractive to entrepreneurs and investors. Code efficiencies mean fewer things to break, lower server loads, less expensive processing costs, AND… less energy used, which means greener technology!
There is vast opportunity in the realm of energy efficient computing and other areas of IT for innovation from entrepreneurs. IT energy efficiency solutions have tremendous upside, do not require capital intensive pilot projects, and have dramatically shorter development cycles than other CleanTech sectors.
Understanding Canadian CleanTech
Earlier posts discussed CleanTech across Canada, and in particular activity in Vancouver and Ontario. We found the analysis of the data-set of SDTC funded projects to be useful to quickly get an idea of activity in all regions across Canada.
To examine the opportunity further, we prepared the following dashboard charts for reference. The dashboards use total project value (in Canadian dollars) rather than just the SDTC funded portion as we are interested in overall economic activity. Further, projects are attributed based on the location of the R&D and commercial. For example, given that the location of the technology development, and not where it is deployed drives the growth of an innovation cluster, the $175 million waste to ethanol plant conversion plant being built for Edmonton’s municipal waste system is attributed to Quebec because the lead organization, Enerkem, is based out of Montreal.
The first dashboard lists, by SDTC-defined CleanTech sector, each province’s share of funding for projects in that sector.
Next, the dashboard below displays the same data, but groups it by local region such as the Greater Toronto area. Due to the large number of local regions, you may find it helpful to visit the source data, create your own filters by province, and select the local regions you want to compare.
It is particularly important to note that because many aspects of CleanTech do not require the multi-million-dollar pilot projects these areas often provide some of the easiest wins with the simplest business plans.
Information technology is one such area; as we mentioned in a previous article simple things such as code efficiencies that reduce server loads and cumulatively reduce energy consumption need to be factored into assessments of where to invest. An investor who fails to consider system efficiency on multiple levels is failing to do proper due diligence.
IT’s Energy Footprint
The average US home consumes about the same amount of energy today as it did twenty years ago. Major gains made in heating and insulation efficiency have been countered by the increasing number of electronics and appliances plugged in to our walls. In 2009 35% of US residential energy use came from appliances, electronics and lighting; up from 24% in 1993.
This pattern repeats itself in the corporate and industrial world. A clear example is the Bank of America tower in New York which was criticised in 2013 for consuming twice as much energy per square foot as the 80-year-old Empire State Building despite being the first skyscraper to obtain LEED Platinum certification. The source of this contradiction? The massive computing power housed in the building.
“The biggest drain on energy in the Bank of America Tower is its trading floors, those giant fields of workstations with five computer monitors to a desk. Assuming no-one turns these computers off, in a year one of these desks uses roughly the energy it takes a 25-mile-per-gallon car engine to travel more than 4,500 miles. The servers supporting all those desks also require enormous energy, as do the systems that heat, cool, and light the massive trading floors beyond normal business hours.”
The global footprint of the Information and Communications Technology industry (ICT) is significant. A recent study provided estimates of the electricity consumed globally by ICT: In 2012, annual energy consumption in the ICT industry made up 900 TWh or 4.6% of worldwide energy consumption. Growth in energy consumption from the ICT sector is dramatically outpacing growth in all other areas. From 2007-2012, energy consumption from ICT increased by 7% annually vs. 2.9% for all electricity use globally. The transition of computing to the cloud is not proving to be a zero-sum game. While the cloud replaces some corporate servers with more efficient central data centers, computing power and electricity demand is being still being added much more rapidly than it is replaced. As measured by workloads, the global cloud is projected to grow by 27% annually from 2014 to 2019.
Opportunity in IT CleanTech
It is clear that the energy cost associated with IT will continue to grow and become a larger cost to individuals and businesses. There is a large and growing opportunity for entrepreneurs to find simple efficiencies to save companies money.
Only recently have coders began to think about the concept of energy proportional computing, where code efficiency is measured based on the rate at which useful work is done vs. power consumed. University of Washington researchers have developed one approach to this issue called EnerJ, which has been referred to as the language of good-enough computing. These researchers estimate they can reduce energy consumption by 50% or more. At a price of $0.15USD/kWh, the 900 TWh consumed globally by the ICT sector annually costs $135 billion US dollars per year, imagine being able to reduce that by 50%!
The IT industry should be applauded for the efforts it has already made in reducing its energy footprint, but there is still opportunity out there. When Google introduced Android Marshmallow, it drastically reduced phone energy consumption by the phone, and on the network. Considering that there are more than 1.4 billion active Android devices, this change makes a big impact.
Given the explosion of computing devices, servers and networking capacity, there is vast opportunity in the realm of energy efficient computing for innovation from entrepreneurs.
IT efficiency solutions present real opportunities, and payback easy to predict. Code efficiencies alone should be attractive to entrepreneurs and investors. Code efficiencies mean fewer things to break, lower server loads, less expensive processing costs, AND… less energy used, which means greener technology!
