With the announcement of the key points in today’s budget, most eyes are focused on the large deficit the UK government has found itself facing following the unprecedented events in the financial world of late, and the steps the Labour Government is taking to attempt to plug the fiscal hole.

Tucked away in there, however, is what is being referred to as “the world's first carbon budget”

So what will this all mean for businesses? Well first things first, the target has now been set at a legally binding reduction of 34% below 1990 levels by 2020 with a potential further increase to 42% following talks in Copenhagen in December aimed at establishing a new global deal.

Previously this target had been set at 20% of 1990 levels by 2010, so the government is upping its game.

What has to be considered though, is that the potential big ticket savings have already been mostly targeted – fossil fuels, transport, domestic energy with measures such as renewable energy targets, carbon capture and storage, encouraging the switch to public transport, road duties, tax bandings, home insulation, energy saving bulbs etc. As these boxes get ticked, eyes will begin to focus more on what’s “left over”.

As at 2005, 18% of carbon dioxide emissions came for what is classified as “other industries” or industries other than the energy industry. The manufacturing sector in the UK has shrunk dramatically over the last 20 years and we have moved ever closer to becoming a service sector economy – this does not mean, as you may begin to mentally visualise, that we are all now working in fast food restaurants!

So the question has to be asked – where are they going to get all these savings?

The answer has partly already been answered by the government with the Carbon Reduction Commitment, which comes into effect in 2010 and targets large businesses. This will use trade emissions allowances with rewards for those who use less than their allocated allowance. Those who need more will have to buy the excess over the counter in a similar way to a stock exchange.

So what does this mean for IT, surely a laptop doesn’t use that much electricity? I have one word for you: datacentres. It's now time to either run screaming to the hills, or take the proverbial bull by the horns.

Posted by Lynn Allan, Sumerian Analyst

Smart meters have been around for years, however, the technology has been restrictively expensive for a wider uptake. Recently the government unveiled plans to have smart meters installed in every UK household by the end of 2020.

So what difference will they really make? Well, once the initial joy of turning your kettle on and off to see how much it is costing you subsides, what they mean in terms for the consumer is information.

At the moment, many of us pay according to estimated bills by the utility companies, which many times can be wildly inaccurate. If we don’t know how much energy we are consuming both in terms of kWh’s and £’s, how can we alter our behavior? Studies have shown that consumers with smart meters installed save an estimated 7% off their bills in the first year.

Replace individual households with businesses (or kettles with servers) and the savings can be substantial, both in monetary terms and in cutting carbon emissions.

Electricity once produced, cannot be stored – supply and demand have to be matched instantaneously, as a result, electricity companies offer what is known as “demand response” whereby at times of peak demand, companies are offered incentives to reduce their consumption either through cash incentives or rate reductions.

Most datacenters have back up generation capacity in the event of blackouts – this is one method that can be used to participate in such a scheme. But what if we actually knew that in terms of server capacity that we could switch the load to different servers and power down?

If you're interested in this space, take a look at our Sustainable IT and Capacity Planning solutions - they allow IT to know exactly when peak demand times are most likely to occur, which allows a smarter way to manage your energy costs and reduce your carbon impact.

Posted by Lynn Harper, Sumerian Analyst