Green Tech

IBM is looking to clean up companies' supply chains, part of a larger effort to make money from environmental concerns.

The company on Thursday detailed a software and service offering called Carbon Tradeoff Modeler that is designed to give businesses an idea how to lower the carbon footprint of their network of suppliers.

(Credit: IBM)

The need for carbon-modeling supply chain software is driven by regulations to lower greenhouse gas emissions, IBM said. Even in the absence of mandatory measurements and cuts, many companies are already undergoing voluntary efforts.

Large corporations hold significant sway over their supply chain partners in pushing them to reduce waste or energy usage. Wal-Mart, for example, has pushed companies to revamp their packaging to reduce waste.

A corporation can look at different packaging or transportation options and measure energy usage of its suppliers. Using IBM's model, a company can then decide on what steps to take to lower the overall carbon emissions from the supply chain, IBM said.

The analytical software, developed by IBM researchers, is meant to be used as part of a consulting engagement. IBM has been using the software internally for some of its operations as well as an unnamed client.

IBM last year launched a Big Green Innovations initiative to find ways to make money in environment-related areas, such as water conservation or solar technology.

EPS, an energy management company founded by former Enron employees, has developed a system for remotely tracking energy usage at manufacturing facilities with a high level of detail.

The company on Thursday intends to introduce the system, called xChange Point, a hosted application that monitors energy usage at manufacturing facilities and provides Web-based reports to energy managers.

Drilling down: EPS' system lets plant operators get detailed information on energy usage, down to the level of a facility or a process like making buttermilk.

(Credit: EPS)

Comparing data from different locations allows companies to get an idea on how to lower their usage, said company CEO Jay Zoellner.

The company, founded in late 2001, has done business running energy efficiency programs and operating alternative energy generators, including co-generation plants. Typically, manufacturers look for a two-year payback on any kind of energy investment to lower their costs.

But in the past year, carbon management and sustainability initiatives are rising in importance, rather than only reducing energy spending, Zoellner said.

"A lot of companies are struggling with their carbon emissions reduction targets. They need a way to manage and verify they've had an impact," he said.

xChange Point, which includes a hardware device placed at a customer's location and software to analyze data, gives those companies more accurate information and a way to report any carbon emissions reductions, he said.

Correction at 8:10 a.m. PDT: Nike's score has been fixed.

IBM, Google, and Microsoft apparently are model citizens when it comes to reducing their carbon footprint, while Apple has a long way to go.

(Credit: Climate Counts)

Climate Counts, a nonprofit funded by yogurt maker Stonyfield Farm, released on Wednesday its annual assessment of corporations' actions related to addressing climate change and whether they live up to their "green" marketing claims.

Climate Counts uses public information to rank companies in all industries.

The electronics and IT industry had the best industry ranking with a score of 56 on average out of a possible 100 points, led by a score of 77 from IBM, which edged out consistently high performer Canon.

The industry does well because most vendors have done a lifecycle analysis of their carbon emissions, examining energy and consumption of its supply chain partners, and the impact of waste from their products.

Apple, which has come under fire for the use of toxic materials, scored at the bottom of the electronics sector list with an 11.

According to its individual scorecard, Apple's ranking was hurt by incomplete reporting and because it hasn't set goals to reduce its own or its partners' greenhouse gases.

(Credit: Climate Counts)

In the area of Internet/software, Google has become the new standard-bearer. Google got the top spot because it has a program to measure its carbon emissions and because of its program through Google.org to invest in clean-energy ventures.

The overall leader across all industries was Nike, which scored 82. Click here for PDFs of the results and the press release.

In a sign of "green" going mainstream, an IBM survey of CEOs finds that socially oriented customers are wielding more power, aided by social networking on the Web.

The survey, published Tuesday, drew on face-to-face interviews with 1,130 CEOs around the world. It found that CEOs feel less prepared as they would like to deal with the pace of change.

The first is the information omnivore, the type of consumer who is comfortable making his or her opinion known through Web-based tools like social networks.

CEOs said that these proactive consumers, or "prosumers," can be a positive influence if companies can design products based on consumers' expressed preferences.

In addition to being demanding about products, customers are carefully watching corporations' behavior, the study found.

Expectations for corporate social responsibility are rising. Concern over environmental issues has doubled over the past four years, with most of that reflected in Europe and in the Asia-Pacific region.

CEOs said they will increase investments 25 percent over the next three years to better understand socially minded customers, which chief executives identified as the fastest-growing trend.

IBM itself primarily serves large enterprises, rather than selling directly to consumers. It does an annual survey of CEOs to find direction on their business directions and how they intend to sell to their customers.

In the area of clean tech, IBM has a number of initiatives including data center energy efficiency and reducing waste from silicon solar cells. IBM also has a decades-long corporate social responsibility practice.

Last weekend I spoke at the first University of Texas at Austin Sustainable Business Summit. It was an interesting and stimulating event that brought together a diverse group of speakers and audience members to think about different aspects of environmental sustainability, social responsibility, and business. It was put on by the McCombs School of Business and largely organized by students, who did a great job.

One of the first panels had to do with computers, waste reduction, and energy usage. It had a bit of tension to it as one of the panelists was from Dell, and another was an environmental activist who has been pressuring Dell for several years on energy reduction, take-back schemes, and overall sustainability issues. They handled it professionally, but you could tell there was some history there!

The other panelists were from IBM, which is working on low power CPUs for servers, and from a company called Verdiem, which makes software to centrally manage large, installed bases of PCs in corporate environments. Such installations use massive amounts of electricity for prolonged unnecessary periods (such as at night), creating part of the big draw of "phantom" or "vampire" energy. The software allows central control of shutting down unnecessary machines while still allowing maintenance upgrades.

There was discussion of options for renewable energy sources for large data centers, and in fact an article in Wednesday's USA Today illustrates the attention being paid to this issue:

Intel is now the largest corporate user of renewable energy in the USA, the Environmental Protection Agency said this week. The chip giant plans to purchase more than 1.3 million kilowatt hours in wind, solar and other types of green power each year. That's enough energy to power about 133,000 households.

Intel won't say how much extra the green power costs. But the company considers the purchase an "investment in the renewable energy market," spokesman Bill Calder says.

This article also highlights one of the other themes that came up in the panel: business will be an earlier large adopter of green technologies than consumers, because the business case is easier to make and corporations are more familiar with thinking about total cost of ownership rather than up-front costs, which dominate in a consumer retail world. Companies are comfortable with the concept of amortizing capital costs over several years and can easily roll that into their tax calculations. Consumers, not so much.

The other theme that came up was that so goes Europe, so goes the rest of the world. Europe, and in particular Scandinavia, is really driving the legislation on curbing energy, forcing take-back schemes, and in general prodding industry to be more responsible. (The U.S. laws are very weak in most regards in this area, California being a common exception.) But since manufacturers like Dell, Hewlett-Packard and IBM have global supply chains and distribution channels, it doesn't make economic sense to make different models for different markets. So they go with the high bar set by Europe and the U.S. benefits.

But this is just a cop-out on the part of U.S. government. In fact, according to one of the summit panelists, the U.S. is one of only three countries not to sign the Basel treaty on international hazardous waste trafficking (where toxic waste is just dumped on another country's shore). Who are the other two? Haiti and Afghanistan.

We should be matching the European legislation to show commitment and to avoid things falling through the cracks. If we match it (as opposed to creating slightly different rules as we do with car crash tests for example), it will make everything easier and do more to encourage sustainable practices.