Brown’s green taxes to drive IT investments

Environmental technologies are likely to be driven further up the agenda of IT chiefs after chancellor Gordon Brown today unveiled a range of new green taxes as part of his pre-budget report, and new reports revealed the government is keen to launch a carbon trading scheme for large firms not covered by the existing EU initiative.

Brown said fuel duty will increase by 1.25 pence per litre from midnight tonight while air passenger duty will be doubled from February next year, increasing the levy on short haul flights to £10 and long haul flights to £80.

The increase in the cost of travel is likely to strengthen the case for online communication tools and home working technologies, such as web conferencing and instant messaging, which advocates argue can help firms slash costs by eradicating unnecessary corporate travel.

“We are seeing a general trend towards greener ways of working and this announcement will push more firms to investigate [web conferencing] possibilities,” said Ewan Cameron, UK senior sales manager at web conferencing specialist WebEx. “But if taxes make firms look at this, it is the fact that it makes good business sense that is ensuring more firms adopt the technology.”

Richard Barrington, head of public policy at Sun Microsystems, agreed more firms are moving to embrace flexible and home working despite his view that the tax increases are too small to have a direct impact on corporate behaviour. “It would be good to see more incentives rather than just small increases in fuel duty,” he argued. “But either way IT directors need to look closer at the implications of more staff working from home and make sure they have the right security and processes in place to cope.”

Meanwhile, pressure on IT directors to reduce the energy demands of IT equipment is also set to climb after reports in The Guardian newspaper claimed the government is keen to introduce a carbon trading scheme that would apply to any organisation with an electricity bill of over £250,000 or electricity consumption of 3,000 megawatts.

The scheme - which would apply to around 5,000 organisations including supermarkets, hotel chains, banks, universities, hospitals and government departments - would work the same way as the existing EU-backed scheme for heavy industry, with firms granted a carbon emissions quota and those that exceed it having to buy extra carbon credits from those that do not use up their allowance.
Advocates of the scheme argue that it puts a price on carbon and gives incentives to firms to cut their emissions, because those that do so have the opportunity to make money through the trading scheme.

A spokesman for Defra said the proposals are currently going through a consultation phase, but The Guardian cites government sources who claim the proposals have received enthusiastic backing from industry, that they may form the cornerstone of the upcoming climate change bill and that Whitehall is leaning towards a mandatory rather than voluntary scheme.

Barrington said that the proposals could have major implications for IT directors given that such a scheme would effectively increase still further the cost of energy. “I was at one datacentre recently where they have just renegotiated their energy deal and the price has more than doubled compared to the deal they signed three years ago,” he said. “IT needs to set strategic goals for energy reduction and look at strategies for achieving those cuts.”