[Green Growth:Korea`s New Strategy (18)]Green IT is central in green growth policy

The following is the 18th in a series of articles focusing on the Korean government`s "green growth" strategy. The series will also introduce the increasing efforts of major advanced countries of the world to promote a green economy. -- Ed.





The environmental issues have been raised since the 1970s, through sources such as the Club of Rome think tank`s "The Limits to Growth." From the early 1990s, the main focus started to move towards global warming, the gradual rise in the earth`s temperature.

Global warming is largely brought about by fossil fuels like petroleum, which takes up about 85 percent of energy consumption. Regarding global warming, the Stern Review on the Economics of Climate Change published in 2006 argues two things: One is that "the overall costs and risks of climate changes will be equivalent to losing at least 5 percent of global GDP each year, now and forever." The other is that "the benefits of strong early action outweigh the costs."

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The far-reaching worries about global warming and the need to react led the United Nations to initiate the Climate Change Convention in May 1992. In 1997, a majority of the nations participating in the convention came to sign the Kyoto Protocol in Japan, which might be the first common countermove to cope with global warming. The main purpose of the Kyoto Protocol is to set practical and attainable targets, quantified emission limitation and reduction objects, or QELROs to reduce greenhouse gas emissions and force signatories to execute their reduction promises.

In 2001, the United States, which accounted for more than 35 percent of global CO2 emission, failed to get Senate approval on the Kyoto treaty. As the reason for its rejection of the treaty, the U.S. Senate cited the exclusion of such heavy polluters as China and India from the treaty obligations. But the real reason was believed to be concern that the treaty could put too much burden on U.S. businesses.

Instead of ratifying the treaty, the United States proposed the Major Economies Meeting on Energy Security and Climate, insisting on the participation of developing countries.

From 2013, a post-2012 climate regime based on the Bali Action Plan will go into effect, impacting on the Korean economy. The private and public sectors will be compelled to reduce greenhouse gas emissions and cut energy consumption. The general public, too, must make efforts to reduce energy consumption.

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Aside from global environmental issues, major nations are seeking to create new growth engines which enable sustainable development. The current development mechanism that relies heavily on natural resources like petroleum, wood and so on will eventually face difficulties due to the depletion of these natural resources. Amid the recent financial hardship, a number of nations are promoting the so-called "Green New Deal" to get out the financial troubles and tackle global warming as well.

While "green" has been considered incompatible with "growth," the Green New Deal is now hoped to kill two birds with one stone. Policymakers firmly believe that green growth projects will help reactivate their economies and generate a new energy industry.



The green growth policy has two main thrusts -- improving the efficiency of energy consumption and developing new green energy sources that can replace fossil fuels. Developing new energy sources is much more expensive and time-consuming than improving energy efficiency. So almost all nations focus on saving energy and improving energy consumption efficiency. But it does not mean that they care less about the development of new energy sources. Many nations are determined to develop renewable energy sources because they are needed to overcome today`s economic recession.

From now on, we will focus on saving energy and improving energy consumption using information technology, not on developing new energy sources. These days, non-IT industries increasingly take advantage of IT. For example, the automobile industry uses more information technology to enhance customer satisfaction. The aviation industry develops testing simulation software to save costs. This trend of employing IT is expected to spread much more widely. Promoting green growth is not an exception.

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Green IT and its role



In the beginning, saving energy, especially electricity, was initiated by manufacturers of electronic products -- refrigerators, TV sets, air conditioners, etc. From the late 1980s, they sought to make their products more energy efficient as part of their efforts to maintain competitiveness. Then, the rapid development of IT led other industries such as the automobile industry to reduce energy consumption of their own products with the help of IT.

But until recently, the energy-saving efforts of manufacturing companies were limited to the product level, not the entire society or planet. When they tout the energy efficiency of their products, their ultimate aim lies not in saving the Earth but in increasing sales.

The same is true of IT product manufacturers. Energy efficiency tends to be used as a marketing slogan that manufacturers employ to win competition. But manufacturers should not forget that IT products also run on energy. The more products they sell, and the wider IT network expands, the more energy is consumed. Especially the emergence of always-on systems and the ever-shortening product life cycle of IT products make the problem of electricity consumption and CO2 emission in the IT sector worse.

According to reports released by Gartner, Inc., the world`s leading IT research and advisory company, the CO2 emission of the IT sector took up about 2 percent of the total in 2007, almost the same level as that of the airline industry. While that amount might look relatively small, when compared with other polluting industries like steel or chemicals for now, the IT sector`s CO2 emission will increase up to 10-15 percent in 2025.

The Wall Street Journal reported that electricity consumption of one big data center is equal to that of a small city with a population of 30,000 to 40,000. The Japanese Ministry of Economy, Trade and Industry predicts that, in 2025, electricity consumption of the entire global IT sector will be 9.4 times higher than that of 2006.

Today the situation is changing. Manufacturers need to save energy not simply to survive market competition but to meet government obligations. The government has begun to monitor and control nationwide energy consumption under the name of green growth.

Green IT can be defined in narrow or broad terms, as shown in Table 1.

As seen above, green IT was initially limited to the product level like ① and ②, which might be called green IT in a narrow sense. On the other hand, green IT in a broad sense includes all of the levels.

As green growth policy becomes more important, green IT also becomes critical, not because the IT sector is notorious as an energy black hole but because IT itself plays the essential role in implementing green growth policy. In other words, emphasis of green IT moves from green IT itself to IT utilization, that is, green IT in a broad sense.

The World Wide Fund for Nature, an international nongovernmental organization for the conservation, research and restoration of the environment, reported that the global CO2 emission could be reduced about 7 percent by optimizing current systems with existing IT and up to 25 percent through dematerialization -- a decrease in the consumption of energy or goods -- with the help of IT, for example, e-commerce, flexible work and so on. The latter might be green IT in a broad sense.

This point was driven home by Connected Nation, a U.S. national nonprofit organization committed to expanding access to and use of broadband internet, when it stated in 2008: "Adopting a national policy to stimulate the deployment of broadband in unserved areas of the U.S. could have dramatic and far-reaching economic impact. For instance, just a 7 percentage point increase in broadband adoption could result in the followings: 3.2 billion fewer pounds of CO2 emission per year in the U.S. only and $92 billion saved annually by creating 2.4 million jobs."

Today, green IT is more about optimizing total energy consumption and reducing CO2 emission using the state-of-the-art IT and networks. The most significant thing is that green IT in a broad sense plays the essential role of gathering information and controlling energy flows through the network.

As stated before, Green IT plays a vital role in making the green growth strategy a success. Following is a close examination of how green IT is utilized in major advanced nations in implementing green growth initiatives, especially in improving energy consumption efficiency.



The United States



In 1992, the United States introduced Energy Star, a market-driven program designed to identify and promote energy-efficient products to reduce greenhouse gas emissions. In 2001, the National Energy Policy Development Group released its report, "National Energy Policy," marking a shift from a market-driven energy policy to one taking national energy security into account. Following up on the change, the Energy Independence & Security Act in 2007 set the reduction of energy consumption and a stable supply of supply as top policy goals. Here, one notable point is that the act enforces and supports the installation of "IntelliGrid," a smart grid initiated in 2001 by the Electric Power Research Institute to reduce nationwide electricity consumption by 4.3 percent by 2030.

The Obama administration announced "New Energy for America" to chart a new course for U.S. energy policy. Obama`s policy calls for saving energy, reducing energy dependency and creating 5 million jobs over the next 10 years.

The United States initially focused on saving energy and securing energy resources. Then its focus moved to overcoming today`s economic troubles and global warming. Even though green IT is not explicitly expressed in its green growth policy, the Obama administration pledged to deploy a nationwide broadband network and continue the IntelliGrid project, a typical green IT project.



EU



The starting point of the EU`s green growth policy is the Lisbon Agenda set out by the European Council in Lisbon in March 2000. The EU`s major goal at that time was to solve the energy dependency problem. The 2005 green paper, "Energy Efficiency -- or Doing More with Less," proposed to save energy by 20 percent by 2020. Based on that green paper, a 2006 action plan estimated the full energy saving potential in end-user sectors -- 27 percent for households, 30 percent for commercial buildings, 26 percent for transport and 25 percent for the manufacturing industry.

Following the 2006 green paper, "A European Strategy for Sustainable, Competitive and Secure Energy," and the 2007 energy policy review, "An Energy Policy for Europe," more practical targets have been set, summed up by "the triple 20s" -- 20 percent reduction in energy consumption, 20 percent reduction in CO2 emission, and 20 percent of renewal energy in the EU`s overall energy mix by 2020.

The importance of green IT in the EU could be observed from R&D activities. To accelerate low-carbon energy technology, the EU announced the European Strategic Energy Technology Plan in 2007. In the plan, application research mainly focuses on monitoring and optimizing energy flow by using an IT network and sensor technologies, that is, green IT in a broad sense. It might be named an e-monitoring system.

The EU decided to allocate around 9 billion euros, about 27 percent of the total energy R&D budget, to IT. This large IT share speaks for the essential role of IT in forging energy policy.

There is one more thing that should be noted. The EU urges people to actively participate in its energy saving campaign since, just as the 2005 green paper shows, up to 10 percent of current energy consumption could be reduced only by the participation of consumers.



Japan



The Japanese Ministry of Economy, Trade and Industry unveiled the "Green IT Initiative of Japan" in 2008 to harness IT in achieving green growth. The ministry recognized the role that IT can play in improving the operational efficiency of industrial plants, transportation equipment, business activities, and home.

Following the Green IT Initiative, METI launched the Green IT Project, earmarking 3 billion yen for 2008. The project was designed to promote R&D activities in such areas as nanotechnology, organic light emitting devices and green systems in order to reduce electricity consumption and CO2 emission in 2030 to the level of 2006. METI established the Green IT Promotion Council in 2008 to promote its green IT movement. Of the council`s three committees, the Public Relation Committee is charged with educating the public on the importance of IT in protecting the environment. This underscores the importance of consumer participation in green growth projects.

At the same time, METI launched "Cool Earth -- Innovative Energy Technology Program" to accelerate development of 21 innovative energy technologies. They include the intelligent transport system and HEMS/BEMS/Local-level EMS which are the prototype of green IT in a broad sense. HEMS stands for house energy management system, BEMS for business energy management system and EMS energy management system. Other green IT-related technologies included next-generation high efficiency lighting, high-efficiency information device and system, etc.

The case of Japan illustrates the role of green IT in undertaking a green growth strategy. In recent years, Japan has focused most of its major policies on reducing greenhouse gas emission and cutting energy consumption. So much so that Japan gives the impression that it is pursuing green growth without being distracted by the ongoing financial crisis. Nevertheless, it is certain that Japan also expects its green growth initiatives to have a positive effect on economic recovery. Japan`s push for green IT can be called "second IT revolution" and will bring positive effects in the future.



Green IT in Korea



Green IT in Korea might be observed in the following three parts. The first is the "New IT Strategy" announced in 2008 by the Ministry of Knowledge Economy. The strategy calls for improving energy efficiency by 20 percent through the development of energy-saving products and a more extensive use of large building energy management systems based on advanced network technology such as ubiquitous sensor network. The IT strategy takes into consideration the full range of green IT, both in a narrow and broad sense.

The second is the "New Green ICT Action Plan 2012" announced by the Ministry of Public Administration and Security in 2009. The action plan focuses on the public side, aiming to reduce CO2 emissions by 10 percent by 2012 and motivate people to reduce energy consumption by launching "New Green Day." This action plan is well-designed in the sense that it encourages consumer participation as the most effective, fastest and longest-lasting measure.

The last is the "Plan on Developing New Growth Engines and Creating Jobs" drafted by the Korea Communications Commission in 2009. The KCC is expanding green IT-related plans to cover the whole IT sector from equipment to networks.

The Korean government attempts to integrate these three plans promoted by three different ministries into the "National Green Growth Strategy" by launching the Green Growth Commission in 2009. The commission held its first meeting on Feb. 16 and decided to complete a nationwide smart electricity network by 2030.

Though a latecomer, Korea seems to have worked out a comprehensive strategy in the right time. In addition, the strategy is promoted under an efficiently organized administrative structure. Furthermore, the Korean government aims to overcome today`s economic hardships through a green growth policy.

If there is room for improvement in the strategy, despite its well-made design, it could be the full use of IT itself, especially advanced network technology. As shown in the cases of other nations, the IT network, not limited to green IT, plays an essential role in green growth policy. So in terms of synergy effect, there is no reason to avoid the use of well-developed network technology for green growth policy.



Conclusion



In regard to concerns raised by the Club of Rome in "The Limits to Growth," many authors have pointed out that IT could be the answer to resolve most problems caused by industrialization. Until recently, IT has led the world economy, opening a new world called information society. But it also created different kinds of problems, e.g., privacy invasion.

Even though IT can be one of the major polluters in the future as people use more IT devices and services, it remains one of the most important players in solving those problems. In this regard, we need to make full use of IT, especially in networks, to effectively pursue green growth. Some of the green growth initiatives might be best executed with an aquate network in that a nationwide network will enable the optimization of the energy system.

The green growth policy will entail lots of social and economic changes. But people must get used to those changes, because today`s green IT asks us to give up much of our comfortable and cozy life for the time being while the former IT Revolution allows a higher quality of life. And today`s green growth policy could not be well-harvested without voluntary participation.

Finally, we have to recognize that the transition from fossil fuels to new energy sources requires enormous social costs which are caused by, for example, change of car engines, heating systems, etc. In this sense, development of new energy sources is a risky project. Gradual transformation to a new green society would prevent unnecessary costs.



By Hwang Sung-jin