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Building a Base for Sustaining Growth:

Carbon Management Strategy and Intelligence with IBM and Oracle


Lin Gardner
Building a Base for Sustaining Growth:
Carbon Management Strategy and Intelligence with IBM and Oracle

• Why and Why Now


• IBM and Oracle Carbon Management
Intelligence Solution
• Why IBM and Oracle
• Getting Started

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© Copyright IBM Corporation 2008
Businesses and institutions everywhere today have an imperative to
Reduce COST and comply with new Regulations
by cutting carbon emissions

Regulation
To reduce emissions such as: Climate
Change Levy, EU Emissions Trading
Scheme, Building Regulations, CRCs
(from 2010)

Stakeholder Costs
Pressure
Rising costs of energy, transport,
Investors, employees and Company waste disposal and raw materials
consumers

New Business
Developments in products,
knowledge and new technologies

Source: Carbon Trust –


Carbon Management White Paper

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© Copyright IBM Corporation 2008
Businesses and institutions everywhere today have an imperative to
Reduce COST and comply with new Regulations
by cutting carbon emissions

Kyoto Protocol UK Climate Change Programme


Regulation
• Ratified by 55 parties except the US and • A mandatory emissions
Australia To reduce emissions such as: Climate
Change Levy, EU Emissions Trading
trading/reporting scheme, targeting
• emission limits agreed for a 'first Scheme, Building Regulations, CRCs emissions currently not included in
commitment period' of 2008-12 on (from 2010)
the EU ETS or Climate Change
average from a base year of 1990
Agreements. Covering all
GHG reduction target organisations whose electricity
consumption through half hourly
under the Kyoto Protocol meters is greater than
Switzerland, Central and East European
6,000MWh/yr – equivalent to an
states, the European Union -8% Company
United States** -7%
annual electricity bill of ~£500k.
Japan, Canada, Hungary, Japan -6%
Russian Federation and Ukraine +0%
Norway +1%
Australia** +8%
Iceland +10%

Source: Carbon Trust –


Carbon Management White Paper

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© Copyright IBM Corporation 2008
Legal Compliance Carbon
Reporting scope Intelligence

CO2 SF6 CH4 N2O HFCs PFCs

Reporting CO2 Emissions from Scopes 1 and 2 are mandatory for


large corporations
Scope 1 Employee
Scope 3
Scope 2 Direct Business
Indirect Travel
Indirect
Purchased Electricity Production of
for Own use Purchased Materials
Company Owned
Vehicles Waste
Disposal

Product Use

Fuel Combustion Outsourced Activities

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© Copyright IBM Corporation 2008
Businesses and institutions everywhere today have an imperative to
Reduce COST and comply with new Regulations
by cutting carbon emissions

Provides positive visibility to • Stakeholder Pressure –


INVESTORS, From investors, market and
REGULATORS, AND financial analysts, employees or
consumers about the
CUSTOMERS
environmental and economic
consequences of climate change
• Consumer pressure to reduce
product packaging, their desire to
Stakeholder
purchase products and services
Pressure
from sustainable sources
Investors, employees and Company • Employee pressure to work for
consumers
business with ethical and
transparent practices/processes
• Investor pressure to maintain
returns in the light of changing
markets
• Desire to maintain market position
in the eyes of financial analysts
who predict change due to
Source: Carbon Trust –
Carbon Management White Paper
environmental conditions

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© Copyright IBM Corporation 2008
Businesses and institutions everywhere today have an imperative to
Reduce COST and comply with new Regulations
by cutting carbon emissions

Promotes employee • New Business -


innovation to create new Developments in markets,
knowledge and new
products + increases technologies, which enable
investment business to cut their carbon
emissions while increasing
productivity and finding potential
new revenue opportunities
• Desire to maintain market share
in the light of changing opinion
Company • Necessity to change production
of product components due to
desire to be green
• Creation of new greener products
to take advantage of new
New Business markets
Developments in products, • Investment in research and
knowledge and new technologies
development around green
products/ processes
Source: Carbon Trust –
Carbon Management White Paper

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© Copyright IBM Corporation 2008
Businesses and institutions everywhere today have an imperative to
Reduce COST and comply with new Regulations
by cutting carbon emissions

• Costs – Gives opportunity to decrease


• Increase in costs as raw
material availability
cost during the current global
reduces economic “crisis”
• Rising fuel prices
• Punitive costs around
waste disposal
Costs
• Costs of preparation of
waste prior to recycling Rising costs of energy, transport,
Company waste disposal and raw materials
• Rising energy prices for
heat, lighting
• Mandatory business
requirement to report in
raw material usage

Source: Carbon Trust –


Carbon Management White Paper

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© Copyright IBM Corporation 2008
Making the Case for a Carbon Management Strategy

• Reduce your environmental emissions footprint

• Build a base for sustaining growth


– maintain competitive differentiation
– strengthen brand image
– develop a competitive advantage
– be better positioned to enter new markets

• Help establish leadership position among your peers

– Attract high calibre workforce


– support your brand's commitment to green

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© Copyright IBM Corporation 2008
Building a Base for Sustaining Growth:
Carbon Management Strategy and Intelligence with IBM and Oracle

• Why and Why Now


• IBM and Oracle Carbon Management
Intelligence Solution
• Why IBM and Oracle
• Getting Started

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START DOING™
© Copyright IBM Corporation 2008
If your Customers pose these questions….

What are the What solution


Business should I
challenges / implement to
drivers / triggers be
to going Green? compliant?

Then this is the


solution…
What business results How will going
/ expectations are green affect
required by my business/
Stakeholders and marketplace
position?
Employees?

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© Copyright IBM Corporation 2008
Business Benefits

Push Factors Protection Enhancement Leadership Pull Factors

• Protect financial • Enhance • Differentiate the


• Legislation objectives by earnings by company and • Social
meeting all legal mitigating risk create a market Responsibility
and regulatory exposures and
• Specification contributing to advantage via
requirements
society innovative
activities and • Customer
• IPCC
commitments demand
• Balance SP
• EU • Minimize costs and commitments with
risk exposures, desired returns
even if foregoing from SP initiatives
• National Govt some sustainable • Manage risks and
opportunities costs associated
• Invest in programs with new, innovative
• Local Govt that reduce risks programs and
• Limit SP activity to while garnering
what is required to benefits for the
• Energy prices operate the company
business

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© Copyright IBM Corporation 2008
Overview

• Strategy components
– Install Carbon Intelligence
– Create baseline emissions reporting
– Perform Green Sigma process engineering
– Measure improvement

• Solution components
– OBIEE
– Base data
– Extraction tool/ Warehouse

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© Copyright IBM Corporation 2008
Oracle E Business Suite
Configuration
Reporting Area Modules Covered
• Business travel • HR, Time & Labour,
– Air, Taxi, Rail, Car Expenses, Payables
• Energy • HR, Property Management
– Electricity, Gas and other fuels
• Distribution • Logistics & Transport
– Fleet Management
– Storage
• Manufacturing
• Manufacturing,
– Raw Materials
– Processes
– Waste
• Compliance • Internal Controls Manager
– What-if

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© Copyright IBM Corporation 2008
Business Travel

Estimating the CO2 Emissions of business travel (not including


commuting) by :

• Air (including class of ticket and type of flight)


• Private car (by individual car emissions)
• Taxi
• Train (including class and type of ticket)
• Hire car

Captured at point of data entry via expense


report or direct feed from travel agent
Categorised by Dept/Project/Individual where
applicable
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© Copyright IBM Corporation 2008
Business Energy

Estimating the CO2 Emissions of Energy used by business by :

• Energy Type (Electricity, Gas, Renewable)


• Scope 1 (Owned and controlled) Geothermal solar & wind
biomass & waste
0%
• Scope 2 (Imported) 11%

Hydro
2%

Captured at point of data entry via


remote metering or by using invoices/
other forms of data entry

Categorised by site where applicable

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© Copyright IBM Corporation 2008
Distribution

Estimating the CO2 Emissions of Distribution Activities by :


• Transport Type
HGV by class, axle
Other carriage methods
• Distance travelled
• Commodity moved
Captured at point of scheduling from
Distribution centres

Categorised by driver/site where


applicable

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© Copyright IBM Corporation 2008
Manufacturing

Estimating the CO2 Emissions of Manufacturing :

Along the full product life cycle:


Categorising ‘green’ credentials of raw
materials including packaging
Broken into bill of materials

Categorised by site where


applicable

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© Copyright IBM Corporation 2008
Internal Controls

Integrating all CO2 measures into Internal Control Manager


Reporting across all business processes
Integrating with workflow
Providing Business Modelling across ‘What-if’ scenarios
Including auditing criteria

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© Copyright IBM Corporation 2008
OBIEE
Process Flow

Oracle

Data Sources Administration Server Presentation Services

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© Copyright IBM Corporation 2008
Types of Reports/ Analysis Example Deliverables
• Comparison to target • Breakdown, by:
– monthly – region
– year-to-date – building
– rolling 12-month – department
– cumulative reductions – project
– individual
• Trends
– month-on-month • Ratios, by:
– YTD vs. last year – FTE
– month vs. year ago – workstation
– m2
• Benchmarking – mile travelled
– internal
– external • Summaries, by:
– “Scope” of emission
• “What if” / scenario analysis – carbon reduction initiative
– carbon impact of business changes – any of the above metrics

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© Copyright IBM Corporation 2008
Building a Base for Sustaining Growth:
Carbon Management Strategy and Intelligence with IBM and Oracle

• Why and Why Now


• IBM and Oracle Carbon Management
Intelligence Solution
• Why IBM and Oracle
• Getting Started

STOP TALKING
START DOING™
© Copyright IBM Corporation 2008
Why Choose IBM?

• Although 3rd party Carbon Emissions reporting solutions exist. No major


ERP vendor has an offering ready for market.

• IBM are industry leaders providing sound Thought Leadership on


Carbon, advising Government bodies and industry alike.

• IBM have produced proprietary software which measures carbon and


have used it successfully both within industry and at Defra.

• IBM and Oracle have a strong stable relationship. Oracle have expressed
a desire to work with IBM on addressing this gap in Carbon Reporting.

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© Copyright IBM Corporation 2008
Progress Toward Our Goals

฀More than 2,000 client projects


฀1,000 IBMers trained and deployed
฀‘Green’ specialization program for IBM Business Partners
฀IBM Virtual Green Data Center
฀Over 1.5 billion lbs. of IT equipment recycled since 1996
฀Over 35,000 in ‘green-community-of-interest’
฀New Enterprise Data Center strategy is green by design

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© Copyright IBM Corporation 2008
IBM and the green agenda:
We have a 37 year old environmental commitment…

1 2 3
Set substantive goals - Effective Be transparent and verified Demonstrate leadership in your
global goals should document Declaration alone is not acceptable – the industry - Partnerships and collaborations
integrated results from across all market demand is for 3rd party recognition of are important if you want to improve
aspects of your business progress against targets environmental performance of your supply
chain.

44% 17yrs 1st

Between 1990 and 2006, IBM’s Annual corporate environmental First in our industry to establish numeric goal for
global energy conservation actions reports released every year since reducing PFC emissions
reduced or avoided CO2 emissions 1990
by an amount equal to 44% of our First in ComputerWorld’s Top 12 Green IT
1990 emissions. U.S. Dept. of Energy's Voluntary vendors.
Greenhouse Gas Emissions Reporting for
New goal: to extend the above 13 years (since inception) Charter memberships in World Wildlife
achievement by reducing CO2 Fund's Climate Savers program, World Resources
Reported to the Carbon Disclosure Institute's Green Power Market Development
emissions by 12% between 2005 Group, U.S. EPA Climate Leaders and Chicago
and 2012. Project for 5 years (since inception) Climate Exchange

Member of U.S. EPA’s SmartWay Transport


Partnership and Green Grid Consortium

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© Copyright IBM Corporation 2008
IBM Qualifications

• Green Expertise
– Innovation for the planet
– Greener solutions
– Energy-efficient IT
– Environmental stewardship
– DEFRA client project

• Functional Expertise
– SCM
– FM
– BI
– ERP
– CRM

• Oracle Product Expertise


– Deep Applications Expertise
– Extensive Technical Resource

• Thought leadership
– Studies
– White papers

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© Copyright IBM Corporation 2008
Building a Base for Sustaining Growth:
Carbon Management Strategy and Intelligence with IBM and Oracle

• Why and Why Now


• IBM and Oracle Carbon Management
Intelligence Solution
• Why IBM and Oracle
• Getting Started

STOP TALKING
START DOING™
© Copyright IBM Corporation 2008
Call to Action

• Who do I contact at IBM?


Lin Gardner lingardner@uk.ibm.com 07876 683419

• Who do I contact at Oracle?


Philippe Reveillon philippe.reveillon@oracle.com +33 6 26 08 08 68

• Identify Target Accounts/Sectors


• Discuss/Form Strategy/Opportunities
• Plan Outreach

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© Copyright IBM Corporation 2008
Questions

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© Copyright IBM Corporation 2008