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It already makes Office. Now, Microsoft wants a hand in controlling your office.

Like IBM, Microsoft has launched an effort to make itself a major player in the rapidly growing energy-efficiency market. The company is recruiting developers and is eyeing opportunities to produce software itself for building control systems, traffic management systems, or even the software that gets used by water quality management districts.

It's a strategy driven by opportunity and need. Climate change and rising power prices are forcing corporations and individuals to seek out ways to curb energy consumption. Besides costing more, energy is highly inefficiently used. Some studies note that about half of the electricity produced does not get used for a productive purpose. Carbon taxes, or cap-and-trade systems, are likely inevitable: all three U.S. presidential candidates support them.

On the other hand, building management and water control systems aren't exactly perched on the cutting edge. Many companies still sell closed, proprietary systems for controlling heating, lighting, etc. Two of the biggest clean-tech IPOs last year were for companies--Comverge and EnerNoc--that have devised systems for automatically curbing electricity consumption. IBM, meanwhile, is in the midst of conducting trials with utilities to control thermostats and appliances remotely.

"The whole transportation sector has huge inefficiencies that can be reduced by software," said Rob Bernard, Microsoft's chief environmental strategist, in a phone interview. When I asked him how big the need is for modern software for building management, he laughed. Years ago, he worked in commercial real estate.

"I am highly familiar with the massive opportunity for software and intelligence to optimize energy control systems," he said. "I think that buildings account for something like 37 percent of greenhouse gases around the globe. If you look at the big sectors--transportation, buildings and building management, deforestation, electrical grid, and utilities--in every one of those we are looking at how software can enable innovation."

As in other markets, Microsoft will rely heavily on third-party developers. The developers will come up with the applications, and these will run on MSFT platforms.

"We will build some applications ourselves and we will try to accelerate the entire market to address this problem," he said.

In December, it kicked off a program, called Ingenuity Point, in which developers submit applications or ideas for applications. Microsoft then gives awards each quarter to the best ideas and tries to promote the most promising in the marketplace.

One of the winners, OSIsoft, for instance, has devised business intelligence applications for tracking how much water gets lost from the reservoir until it finally hits the tap. The company is also involved in a desalination project in Australia. The country is currently wrestling with a prolonged, severe drought. Another company in France has come up with a traffic management and monitoring application: this can help delivery companies avoid clogs and thus save gas.

Stay tuned for my upcoming, related article: Microsoft's plan to make more efficient products and curb energy in its own operations.

WASHINGTON--Dell chief Michael Dell and other high-profile technology company CEOs descended on the nation's capital Wednesday with a message for policymakers: do more to encourage energy-efficient practices, but don't spell out specific standards for the products that companies like theirs build.

On behalf of a lobby group known as the Technology CEO Council, Dell, EMC chief Joe Tucci, and Applied Materials head Mike Splinter suggested the government should do more to "lead by example." They said it can do that by reevaluating its own power consumption, setting "high goals" for energy efficiency, awarding presidential medals to companies that excel in using information technology to boost their energy efficiency, and minimizing trade and tariff barriers and maximizing tax incentives for companies with a track record of efficient energy use.

"The industry is moving, the market is moving, but it could and should be moving faster," Bruce Mehlman, the Technology CEO Council's executive director, told reporters during a morning briefing. "This is a good place to help get that message out."

Often, when business leaders ramp up Capitol Hill lobbying, they're attempting to stave off burdensome new regulations, but Mehlman and the executives said there's no particular proposal floating around that troubles them at the moment.

Still, Dell, whose remarks began with a boast about his company's "commitment to being the greenest technology company on the planet," pointed out that there are some things government shouldn't do, such as attempting to establish a "one-size-fits-all mandate for development and design of IT products."

The executives also touted two new studies that convey what some may consider to be a paradox: by their estimation, the rise of technology use has actually helped improve energy efficiency.

One of those reports, commissioned by the Technology CEO Council and produced by economists at the nonprofit American Council for an Energy-Efficient Economy (ACEEE), argues that for every kilowatt hour of electricity consumed by computers, servers, telecommunications technology, and all manner of gadgets, the U.S. economy increased its overall energy savings by a factor of about 10.

Although that conclusion may seem counterintuitive, it's based on the idea that those gadgets are displacing the need for other energy-consuming activities, resulting in energy savings, said study co-author John Laitner, an economist and former Environmental Protection Agency official. He described an example from his own life: rather than flying to Sweden for a meeting, he recently partook in it from a local office via videoconference. (Laitner also nevertheless acknowledges in the report a "lack of precise data" to back the findings.)

The second report, produced by the Technology CEO Council, lists dozens of examples of products made by its member companies and others that have managed to improve power consumption over the years.

According to the ACEEE report, the information and communications technology sector currently accounts for about 6 percent of the nation's power consumption, up from about 2 percent to 3 percent in 2000. But CEOs like Dell and EMC's Tucci said they're confident that improvements in technology will keep that percentage from growing exponentially in the years to come.

The suggestions, for the record, aren't exactly new. In a report to Congress last August, the EPA suggested the nation could save up to $4 billion in energy costs if it made its data centers more energy-efficient. The agency also predicted that the amount of power used by U.S. data centers, which consumed 1.5 percent of total U.S. electricity consumption in 2006, would more than double over the next five years, at a cost of $7.4 billion each year.

Incandescent bulbs are getting it from all sides these days.

Taiwan may soon join the list of national and state governments to impose regulations that lead to the demise of traditional incandescent bulbs. Neal Hunter, CEO of LED Lighting Fixtures (LLF), says there are rumors in the lighting world that Taiwan will pass legislation that would phase out incandescents by 2011 or 2012. Sporadic reports in Taiwanese papers have come out saying that the Ministry of Economic Affairs wants to get rid of incandescents too.

Taiwan will also promote LEDs as the light source of choice for the future, he added during a presentation at the ThinkEquity ThinkGreen conference.

While Hunter said he hasn't been able to confirm the status of any bills, it makes sense. Incandescents consume quite a bit of energy. Close to 95 percent of the power gets converted into heat, rather than light. Taiwan, like other Asian nations, is struggling with ways to get consumers to cut down on electrical consumption. LEDs and compact fluorescent bulbs use considerably less energy and last longer, although they cost more.

Taiwan also plays a key role in the LED market. LEDs are chips, after all, and Taiwan remains one of the chief centers of semiconductor design and manufacturing. Supporting LEDs would be another of the country's job and export creation measures.

LLF, by the way, is a company worth keeping an eye on. It makes light fixtures based around LEDs. It has installed LED lights at McDonald's, Denny's, Starbucks, Marriott, Best Western, and Microsoft.

At $75, LED light fixtures cost more than standard light figures, but they use a lot less power. LLF just came out with a fixture that puts out the same amount of light a 65 incandescent bulb would, but it only uses 5.8 watts.

"Last year the best we could do was 11 watts," he said.

The quality of light is getting better, as well. "The current perception is a bunch of little lights shining through a fixture," he said. "The only way to make it (commercially) is so that people don't know the difference."

To take the sting out of the cost of the fixtures, utilities have begun to issue rebates to customers to encourage them to buy LED lamps. One is offering commercial building owners a little over $22 for each LED lamp they install. LLF also has LED lamps for the residential market, but the market will take a little longer to take off.

The company is also staffed and run by LED veterans. Hunter himself used to be the CEO of Cree, a large LED manufacturer.

North Carolina's LED Lighting Fixtures has received a $16.5 million injection as the push to bring light-emitting diodes to the home gains momentum.

The company makes light fixtures for commercial buildings and homes around LEDs. LEDs consume far less energy than incandescent bulbs--LED Lighting Fixtures, for instance, sells a lighting unit, the LR6, that puts out 650 lumens but only consumes 12 watts. One or more LEDs can be combined into a single light fixture as well.

Individual LEDs are beginning to challenge compact florescent bulbs in lumens per watt. LEDs also last longer--some go as long as 50,000 hours before burning out--which reduces maintenance costs. You also don't have the messy mercury recycling problem you do with CFLs. Toronto, Ann Arbor, Mich., and Raleigh, N.C., have all launched initiatives to replace conventional light fixtures with LED fixtures and some builders are incorporating LED fixtures into new homes.

LEDs, however, are more expensive than CFLs or incandescent lamps. The price will go down over time because LEDs are chips and will take advantage of the economies of scale that come from mass manufacturing. Still, a five pack of LR6s goes for $130.

Other companies making LED lighting fixtures include Lemnis Lighting.

LED Lighting Fixtures gets its LEDs from Cree, which is also in North Carolina. The lead investor was Digital Power Capital.

IBM is launching an initiative to give its corporate customers a way to measure and potentially monetize energy-efficiency measures in their data centers using an emerging form of currency.

The computing giant on Friday detailed a program that will let companies earn energy-efficient certificates, which are awarded after a company undertakes a project to lower its data center power consumption. It's part of its Big Green Innovations program to invest in clean tech.

IBM is partnering with Neuwing Energy Ventures to verify the amount of kilowatt hours reduced through data center makeovers.

Companies can either claim those energy reductions as part of their own corporate environmental initiatives, which increasingly call for more quantifiable measures. Or they can sell the energy-efficiency certificates on the voluntary renewable energy certificate market. A handful of states also have a mechanism to sell these certificates to utilities that have renewable energy mandates.

IBM designed the program because more companies are looking for ways to accurately measure their energy consumption as part of environmental programs, said Rich Lechner, vice president of IT optimization at IBM.

He said he expects most customers to hold on to the energy-efficiency certificates rather than sell them. The monetary value of a large-scale energy efficiency program could be worth hundreds of thousands of dollars if the company chooses to sell as credits, he said.

The energy-efficiency credits are part of a growing trend to use financial markets to reduce greenhouse gas emissions.

Most corporations in the United States are not regulated on the basis of their greenhouse gas emissions. But that's expected to change within a few years.

There are a number of federal proposals designed to put a monetary value on emissions, such as carbon dioxide. Some regimes call for a tax on carbon emissions, while others are built around a cap and trade model where polluters have a maximum emissions target and are issued credits when emissions fall below that cap.

IBM will offer the energy-efficiency credits on its mainframes and midrange servers to clients in the U.S. this year. It intends to extend the offering to its entire server and storage line and offer it to customers in Europe next year, said Lechner.

SAN FRANCISCO--CORRECTION: Right now, if you buy an energy-efficient dishwasher, utilities like PG&E will give you a cash rebate.

They may do the same for energy-efficient PCs.

The Climate Savers Computing Initiative, a consortium of tech companies that is trying to get the industry and consumers to adopt energy-efficient components, has started to explore the idea of direct rebates with utilities, said Erik Teetzel, a program manager at Google during a meeting at the Intel Developer Forum taking place in San Francisco. Google and Intel are the driving forces behind Climate Savers. (correction: we spelled his name wrong. He wrote it on a business card.)

Some component makers already qualify for rebates from utilities. The payments, though, go directly to these manufacturers. Consumers might enjoy lower retail prices as a result, but it's not the same as getting a check in the mail.

Climate savers earlier this year touted a supposedly more efficient power supply that it is promoting to PC and server makers. Its next initiative will be to persuade IT managers and consumers to adopt the power saving settings on their computers.

EnerNOC, a company that sells software to businesses for lowering their energy bills, said on Monday that it has bought energy consulting firm MDEnergy for $7.9 million in cash and stock.

MDEnergy, based in Stamford, Conn., provides consulting and market information to large energy buyers looking for competitive bids in deregulated markets, according to an EnerNOC representative. The company organizes request for proposals and hosts auctions where suppliers bid on both electric and gas contracts.

The company also provides detailed industry data on usage patterns to aid in contract proposals. MDEnergy's platform will operate independently in the near future, the EnerNOC representative said.

EnerNOC sells so-called demand response software that is designed to dial down energy consumption at large organizations. With the system, a company could, for example, automatically turn off unnecessary fans or turn up air-conditioner thermostats to avoid paying for pea-time electricity prices.

"It has been our vision to simplify the process of purchasing energy and green power solutions in restructured markets," said Tim Healy, EnerNOC's CEO, in a statement.

EnerNOC, founded in 2001 and based in Boston, went public earlier this year and is considered one of the most successful clean tech companies to launch in the past five years.

DAVIS, Calif.--You read a lot about renewable energy and the coming opportunities, but there's still a lot of money to be made in gas.

Mark Henwood, managing director at Camino Energy, which analyzes alternative fuel stocks, recently ran a math problem to see just how big the clean tech market is. (We ran into him near the buffet line at the GoingGreen conference this week.)

He totaled up the market cap of all of the clean energy companies now traded on the public exchanges. The list includes solar companies, ethanol refiners and clean coal manufacturers. It does not include agribusiness companies with interests in fuel, however.

Henwood found 314 companies with a cumulative market cap of $210 billion as of September 9. That's about 40 percent of the size of Exxon Mobil, which hovers at around $465 billion.

Henwood's observation dovetails with a comment from Justin Adams, director of long term research at BP. There are many discussions at energy conferences, but not many on existing energy sources. Still, we will have to come to grips with issues like coal gasification and sequestration, among other topics, Adams added.

DAVIS, Calif.--Reporters who covered software in the '90s will remember Karl Jacob. Microsoft bought his company, Dimension X, in 1997. He was chatty. Occasionally, some reporters referred to him as "sources close to the company."

After leaving the big M, he went off to Keen, Benchmark Capital and a few other things. And now, he's the world record holder of the standing mile speed record.

This Viper runs on ethanol.

(Credit: Michael Kanellos/CNET News.com)

In July, Jacob cranked up his modified Dodge Viper from a standstill to finishing a mile in 27.41 seconds. He hit 220.7 miles an hour during the sprint, a record. The old top speed for the standing mile was just under 218 miles an hour. He did eight runs on the day.

Jacob didn't drive the car on the record run. Instead, it was driven by Ron Misjak of Super Viper, which modified the car. In any event, Jacob did pay for it, has driven the car and says it's a kick. That puts him ahead of Alcibiades, who won a first in chariot racing at the ancient Olympics without getting behind the reins. (It was a common practice among the nobles.)

We spoke at the green car pavilion at the GoingGreen conference in Davis. Karl and Ian Wright of Wrightspeed showed off their performance cars. Others were showing off low-speed electric vehicles.

Jacob and a team of mechanics had to tinker quite a bit with the Viper. They boosted the horsepower from 500 to 1,200, for one thing. Additionally, they switched it from running regular gas to running E85 ethanol. E85 comes with an octane rating of 105, higher than regular gas.

The engine

(Credit: Michael Kanellos/CNET News.com)

"It is not common knowledge that you can convert these cars (Vipers) to E85," he said. But apparently, it's pretty easy. All you have to do is upgrade the fuel lines, change the engine's computer and alter the timing.

More than doubling the horsepower probably had a big effect on the performance of the car, but the extra octane can't hurt. Ethanol also cuts down on the greenhouse gases from the tailpipe. Fast clean cars are sort of a fad. Earlier this year, a 1965 biodiesel-burning Impala that beat a Lamborghini in a drag race. Electric sports cars, meanwhile, are coming to market.

Overall, the Viper and its modifications cost about $200,000. Good thing Jacob worked at Microsoft.