Information Systems for Environmental Sustainability

IT, Resource Productivity, Environmental Preservation, and the Fourth Industrial Revolution

From Carbon to Energy? What’s in a (Software Application) Name?

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A few months ago, the Wall St. Journal ran an article entitled “No Carbon Law In Sight, Energy Management Software Buzzes” asserting that the lack of C02 regulation has driven companies formerly marketing carbon management software to re-brand and re-focus on energy management software.

“We started out in the business with the thesis more on the carbon emissions side,” said Raymond Lane, managing partner at Kleiner who became chairman of Hara this month. This was driven by the idea that “companies are going to be very concerned in the future about managing carbon output with the prospect that the U.S. government is going to be weighing in on carbon, and the world will be more and more concerned about greenhouse gas emissions,” said Lane.

Evidence for a shift to energy? New entry C3’s focus, as asserted in a Groom Energy report:

“The company is focused on Energy Resource Management, and given the amount of money the company raised, C3 is an important vendor to watch in 2011.”

It’s true that the U.S. government has not moved on regulating C02 (except for the EPA rule). At the same time, 214 (43%) of the S&P 500 companies have “self regulated” by disclosing specific targets to reduce GHG emissions, which the article does not mention.

So what might be going on here?

Working with various stakeholders in the industry, I’ve learned that companies expect benefits from the software to include a number of dimensions: energy cost reduction, process efficiency improvement, enhanced branding, hedge bets on future regulation, etc.

Whatever this class of information system is named, the steady increase in the number of G500 and S&P500 firms that report GHG emissions and reduction strategies and tactics will drive the market forward.

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Author: nigelpm

Associate Professor of Information Systems, Stephen M. Ross School of Business, University of Michigan - Helping organizations to navigate digital transformation.

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