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How green is your valley? How much impact could it have? Extract from McKinsey & Company independent analysis for the Climate Group SMART 2020 report July 2008 CONFIDENTIAL This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from McKinsey & Company. This material was used by McKinsey & Company during an oral presentation; it is not a complete record of the discussion.

How green is your valley? How much impact could it have?

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How green is your valley? How much impact could it have?. Extract from McKinsey & Company independent analysis for the Climate Group SMART 2020 report July 2008. CONFIDENTIAL. - PowerPoint PPT Presentation

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Page 1: How green is your valley? How much impact could it have?

How green is your valley?How much impact could it have?

Extract from McKinsey & Company independent analysis for the Climate Group SMART 2020 report

July 2008

CONFIDENTIALThis report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from McKinsey & Company. This material was used by McKinsey & Company during an oral presentation; it is not a complete record of the discussion.

Page 2: How green is your valley? How much impact could it have?

2

The global ICT footprint*

*ICT includes PCs, telecoms networks and devices, printers and data centers. †Compounded Annual Growth Rate

GtCO2e

0.11

0.18

0.35

0.43

0.64

1.08

0.53

0.83

1.43

2002

2007

2020

CAGR†

+6%

Embedded carbon

Footprint from use

2% of total footprint

Page 3: How green is your valley? How much impact could it have?

3

The global ICT footprint by geography

2002

2007

2020

CAGRPercent

17 18 11 13 16 25

23 23 12 10 14 20

27 29 10 7 12 14

9 9 6 3 4 3

% of 0.53

% of 0.83

% of 1.43

Percent of GtCO2e

* EiT = Economies in transition. (includes Russia and non-OECD Eastern European countries) † RoW = Rest of the World. (includes India, Brazil, South Africa, Indonesia and Egypt)

RoW†

China

EiT*

Other industrialized countriesOECD Europe

U.S. and Canada

Page 4: How green is your valley? How much impact could it have?

4

The global ICT footprint by subsector

*Printers were 11% of the total ICT footprint in 2002, 8% in 2007 and will be 12% in 2020

2002

2007

2020 25 18

28 14 57

37 14 49

57

% of 0.53

% of 0.83

% of 1.43

Telecoms, infrastructureand devices

Data centers

PCs, peripherals and printers*

CAGRPercent

5 7 5

Percent of GtCO2e

Page 5: How green is your valley? How much impact could it have?

5

ICT footprint and impact of ICT-enabled abatements

40.0ICT 0.5

2020 BAU

Abatements

2020 with abatements

51.9ICT 1.4

-14.1* -7.8

30†

*For example, avoided deforestation, wind power or biofuels†21.9 GtCO2e abatements were identified in the McKinsey abatement cost curve and from estimates in this study.Source:Enkvist P., T.Naucler and J. Rosander (2007), ‘A Cost Curve for Greenhouse Gas Reduction’, The McKinsey Quarterly, Number 1

GtCO2e Emissions

ICT footprint

Other abatements†

Selected ICT-enabled abatements

2002

5 times ICT’s direct footprint

Page 6: How green is your valley? How much impact could it have?

6

ICT-enabled abatements

* Dematerialisation breaks down into all sectors except power. See detailed assumptions in Appendix 3.† Reduces warehousing space needed through reduction in inventory. See Appendix 3.‡ Reduces energy used in the home through behaviour change. See Appendix 3.

Page 7: How green is your valley? How much impact could it have?

7

Research details

This presentation is extracted from research conducted by McKinsey & Company as independent analysis for The Climate Group on behalf of the Global eSustainability Initiative (GeSI).Full report: http://www.smart2020.org/

McKinsey & Company Contacts:Markus Löffler <[email protected]>James Manyika <[email protected]>Jeremy Oppenheim <[email protected]>

Supporting organizations:GeSI and member companies: Bell Canada, British Telecommunications plc, Cisco Systems, Deutsche Telekom AG, Ericsson, France Telecom, Hewlett-Packard, Intel, Microsoft, Nokia, Nokia Siemens Networks, Sun Microsystems, T-Mobile, Telefónica S.A., Telenor, Verizon, Vodaphone plc.Additional support: Dell, LG