Opinion

The cloud takes the green tint off SAP

There are a number of stories currently circulating on the web concerning SAP’s energy and emissions, principally the fact that the company’s greenhouse gas emissions increased in 2013. Not because SAP was being environmentally irresponsible. Far from it. SAP has reduced emissions by 9% since 2008 despite increasing average employee numbers by close to 26%.

However, the company revealed in its SAP Integrated Report 2013 that emissions had increased in 2013 to 545 kilotons CO2 from 485 kilotons when they were supposed to fall to 460 kilotons.

How had this happened? Had SAP suddenly become less energy efficient overnight? According to the company, it was less to do with what it was doing and more to do with what its customers had done. Or, to put it more accurately, a change in policy by SAP had resulted in the company’s emissions increasing while those of its customers decreased.

As SAP explained in the report: “One root cause for this development is our change in business model. As our customers increasingly leverage SAP software in the cloud, our leadership in this market means that systems that previously ran at our customers’ sites are increasingly running in SAP data centres. In other words, the emissions that used to be caused by our customers running our software have become SAP’s emissions. As a result, our emissions per employee and per euro in revenue increased in 2013.”

Given that SAP had not forecast an increase in emissions, you have to conclude that it did not foresee the consequences the shift to the cloud would have on its environmental policy. I wonder how many other companies might find themselves in a similar situation?

SAP says it is taking steps to address the situation “by powering all our data centres and facilities with 100% renewable electricity. This shift will effectively eliminate the emissions caused by our customers’ systems that have moved into our green cloud”.

In addition, as more customers move to the cloud, it should result in a significant improvement in emissions caused by SAP products overall. As the company argues: “In 2013 alone, the emissions caused by SAP products in use at our more than 253,500 customers’ sites were at least 10 times larger than SAP’s own footprint, meaning they caused more than 5,800 kiltons of CO2. By using 100% renewable energy, we will dramatically broaden the reach of our sustainability efforts and align them with our cloud strategy. We believe this move will not only help the world run better, but contribute to achieving our 2020 carbon target.”

While SAP is taking steps to reduce emissions, I wonder how many other companies might struggle to do the same if they find themselves in a similar situation? It’s clear from the report that SAP places a fairly high priority on energy and emissions but do other companies?

Do those businesses providing hosted cloud services fret as much over their carbon emissions? Will they be taking steps to ensure they are able to reduce overall emissions even as they take on more clients? Is it something they even consider? And should resellers busy helping customers migrate to cloud-based computing environments care what their hosting partner companies do about their emissions?

Or should they merely highlight the fact that moving to a cloud model reduces the client’s emissions while omitting to mention that it increases those for the cloud provider, making it a case of “out of sight and out of mind”? After all, you can’t see, touch or feel those emissions. You can’t smell them either so I wonder how long it would take, if ever, before someone realises that something stinks.

This was first published in March 2014

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