Carbon Tax?
Loading ...Carbon Tax?
I am not an expert in the green stuff but off lately I have been doing a lot of research on this especially the implications of green on IT and what effect it will have on IT migrations for a corporate (as we @ S7 Software focus mainly around migration and re-engineering domain)).
I also sat through many seminars and sessions at Interops 2008 @ Las Vegas and also at NILF 2009 in Mumbai recently. All point to the fact that there is going to be a great green movement in the way we conduct business. Every activity of business will come under the green scanner for sure. Yes companies and the greedy corporate won’t change anything unless there is a profit out of it or there is going to be cost savings. But this issue is not about profits but about preventing the great environmental disaster. Yes corporate won’t budge for obvious reasons, but with an increased awareness of the environmental impact, the green momentum is increasing gaining by leaps and bounds, and my guess is soon government will surely start imposing a special tax called “Carbon Tax” (lot of companies have started already exploring this idea to few countries have already implemented the same). Once implemented, they will start measuring your carbon output, there might be a certified agency who will certify and quantify the same, and you might end up paying this Carbon tax like any other tax and my feeling is going to be pretty heavy and then all corporate will be in that rush to reduce the carbon impact and even nullify the same.
My gut feel is that this imposition of Carbon tax might happen much earlier than most tend to believe and many a times recession might be the best time to clean up your house. Considering this, there are a lot more to be done in the IT part of the world throwing away all those power guzzler legacy machines to moving onto that sleek energy efficient hardware. There might be systems and new algorithms that might become popular where certain way of running and managing resources might bring about that huge reduction in the carbon footprint.
This is where I am betting big on migrating applications and software to follow the migration of hardware and other resources which I call “the Green IT migrations”. I am pretty sure that the Green in IT will definitely stay and will be the next wave; something similar to the Y2K wave of the part of might be bigger. Based on these we are currently working on some of the ways, implications and actual migrations of software/applications from the carbon guzzler hardware to the latest green machines.
This is what my R&D and my intuition says but would love to hear from either sides of the shore, those who have lot of data points about the green wave and its effect on IT and those who consider that it is a fad.
Look forward to your “green to not so green” comments 
Manjunath M Gowda, S7 Software
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Comments
Hi Charles,
Thank you for your detailed reply, appreciate it. It was interesting to see an article about the same in today’s WSJ titled
“Green and Cheaper” and here is the link
http://online.wsj.com/article/SB123739309941072501.html
(might require subscription)
where it says and I quote
“Subaru says it has saved millions of dollars by combining green thinking with in-depth studies of its processes, suppliers and equipment. Where the biggest savings have been achieved, in descending order: reducing waste by revising processes; conserving energy; and working with suppliers.”
Yes, I understand about carbon taxed upstream but what I am arriving is hopefully corporates will be double taxed like we do with the profits. We not only pay say service tax, professional tax, VAT, customs or duty tax etc, the profits will be taxed again as income tax and I am assuming the carbon tax will be similar- not only taxed upstream and at source but also on the amount of carbon footprint. Remember the % of carbon tax at upstream remains same irrespective of whether you have a smaller footprint or a bigger footprint and hopefully with a double taxation and a slab taxation, those who has a bigger carbon footprint will be penalized much more than others.
Thanks again
Regards
Manju
I say Bravo and Amen. A revenue-neutral carbon tax not only significantly reduces emissions and incentivizes the creation of climate-friendly technology, but also returns the revenues to already-struggling families. It’s undoubtedly the superior approach!
indian industry are not going to be effected becuase of carbon tax as indian metal, nonmetal and chemical industry have less trade intensity in respect of the country proposing carbon tax . So any apprehnsion of adverse effect of carbon tax on indian indusry is becuase of ignorance
Dear Manjunath -
I applaud your ecological concern and am excited by your confidence that, with the right price incentive such as a carbon tax, the IT community will be able to radically reduce its carbon footprint.
My one critical comment to your post is one you will find pleasing (I hope): a carbon tax will not require that your or my or anyone’s carbon consumption be measured. Rather, the tax will be imposed far upstream, at the point where the carbon fuel is taken from the ground and sold to the first purchaser such as a refinery or power generator. The tax cost will be passed through the supply chain and eventually show up as higher-priced gasoline, electricity, aviation fuel, etc., thus preserving the price signal on the consumer side.
I hope this news is helpful and positive. Best, Charles (co-director, Carbon Tax Center, New York City, USA)