Analyst round table: Sustainability 6 October 2011
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
2
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3
A better future
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
4
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A massive transformationThe move to a low carbon economy will be as impactful as the industrial revolution
International aviation& shipping*
UK non-CO2 GHGs
Other CO2
Industry (heat &industrial processes)
Residential &Commercial heat
Domestic transport
Electricity Generation
695 Mt CO2e
159 Mt CO2e
77% cut(=80% vs. 1990)
184
134
103
108
98
42
* Bunker fuels basis
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BT Energy reduction to dateOver the last two years, BT has reversed the trend of increasing energy
consumption, despite an ever increasing explosion in digital services
* Bunker fuels basis
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Network growth is driving up consumption, but our energy programmes are reducing consumption at a faster rate enabling net year on year reduction.
Network72%
Data Centres
10%
Estates18%
2,225,626 MWh p.a.
Breakdown of electricity use
1) Networks
2) Data Centres
3) Property
BT is delivering energy reductions and efficiencies in:
2,400
2,600
2,800
3,000
3,200
09/10 10/11 11/12 12/13
Ener
gy in
GW
h pa
BT's Global Energy ConsumptionStatus: August 2011
Growth
Trend
Target
-2.2%vs 09/10
+12% vs 09/10(growth)
TARGET
+3.0%vs 09/10
+4.6%vs 10/11
-2.6%vs 10/11 Re
ducti
on o
f£5
6m p
a76
0 GW
hpa
BT’s global energy consumption going forward
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Where are our energy savings coming from this year?
1. Smart energy control - £6.2m – 22,000 smart meters– 99% of UK electricity consumption and 65% of gas consumption – £17m invested generating £13m annual energy savings
2. Infrastructure rationalisation - £3.5m – Estate – reduction in office space– Data centers – virtualisation and switching off servers– Networks – migration and consolidation
3. Equipment replacement - £8.7m – Replacement of boilers, air conditioning, lights– Variable speed drives, fans
4. Employee engagement - £Priceless – Pan BT engagement – Energy champions
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BT is setting up a Smart Energy Control system to monitor and optimise energy consumption
BMS450 people sites
BMS450 people sites
BMS1,700 operational sites
BMS1,700 operational sites
Smart Metering22,000 installed across 6,000 sites
Smart Metering22,000 installed across 6,000 sites
Energy Control Centre
Energy Control Centre Field
EngineeringField
EngineeringFacility
ManagementFacility
Management
Analyse data
Optimiseremotely
Tasks &Issues
Optimiselocally
Optimiselocally
Tasks &Issues
BT’s Integrated Energy Management System
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1. Energy distribution, transparency and control
NetworkCarrier
EnergySupplier
HubHub
SmartMeter
Micro-generation
In-home display
Energy Management Services via TV
Energy Management online
Electricity
Gas
Data Centre
The Future
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
11
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Emerging lessons on best practice – BT
1. Emissions reductions must be driven from the very top of the organisation
2. Effective two-way communication is key to achieving behavioural change
3. Many carbon reduction projects save money and this is often the dominant driver
4. You can’t manage what you can’t measure
5. External carbon reporting is often driven by reputational or regulatory considerationsInte
rnal
fo
cus
Ext
ern
al f
ocu
s
6. Companies are increasingly feeling compelled to look across the value chain,but often for different reasons
7. Large customers can help improve their suppliers’ environmental performance
8. Many companies engage with their suppliers on environmental issues, butthe engagement is often ineffective and inefficient
9. Most suppliers see clear benefits of helping customers reduce theirenvironmental impact
10. Best practice is often not widely known, but there is ongoing work in someindustries to develop standards and guidelines
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BT Climate Change Procurement Standard• Launched March 2011 – one of the first of
its kind in the UK
• Encourages our suppliers to use energy efficiently and reduce carbon during the production, delivery, use and disposal of the products and services supplied to BT
• Suppliers asked to:
– Have policies in place to address the challenge of climate change
– Measure and report emissions of carbon dioxide and other greenhouse gases
– Set challenging targets to reduce emissions and report regularly on their progress
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Supporting suppliers
• Free supplier workshops in partnership with The Carbon Trust
• Online resources
• Best practice webinars
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Procurement climate change targets 2011-12
85% of BT contracts placed will take energy consumption and / or environmental impact into consideration in the award of business. Tenders should include minimum 5% criteria on energy 1
100% of BT ‘product replacement contracts’ awarded will be able to demonstrate an improvement in energy efficiency and/or reduced environmental impact.2
• Questionnaire & Energy calculation tool for buyers and suppliers
• Climate Change Standard to be included in new contracts
• 2010/11 Targets – P&SC achieved 80% and 100% 3
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Our supplier’s climate change commitments
70%
60%
50%
40%
30%
20%
10%
0%2007/8 2008/9 2009/10 2010/11
Policy on climate change
Monitor CO2 emissions
Targets in place
Source: Annual BT Supplier Survey
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Next steps
• Target to embed into 80% of new contracts this year
• Compliance with the standard identified via the climate change questionnaire in tenders
• Feed-back, reactions and compliance being tracked
• On-going communication with the procurement community and with buyers
• Process of embedding with our buyers
• Carbon Disclosure Project supply chain initiative is showing stronger engagement from our suppliers
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
18
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BT’s pioneering carbon footprinting methodology
Carbon footprinting elements
Customer Domain Service Platform Operational Activities
In-use GHG emissions associated with ICT end-user / customer premises equipment
eca
db f
In-use GHG emissions associated with ICT network and service platform supporting / connecting (but not in) customer domain
In-use GHG emissions associated with labor and non-ICT infrastructure supporting Customer Domain and Service Platform equipment
Embodied GHG emissions associated with Customer Domain equipment / infrastructure
Embodied GHG emissions associated with Service Platform equipment / infrastructure
Embodied GHG emissions associated with Operational / non-ICT capital infrastructure
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World first: carbon footprinting for London 2012
Impact of use-phase and embodied emissions associated with BT’s London 2012 solution:
– equipment dedicated to London 2012
– the contribution of BT’s shared network services which will carry Games traffic
– BT people dedicated to the design, delivery and operation of the solution
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GHG Protocol ICT sector supplement
• Result of BT developing methodology for our services and our experience in road testing draft product standard
• “Practitioners Guide”– written by practitioners for practitioners– how to carbon footprint ICT products (goods & services)– ICT lifecycle and enabling effects [2% / 98%]– examples / case studies / supporting data
• BT co-chairs telecommunications network services sub-group and is on steering committee
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Next steps
• Continue to drive industry collaboration towards global agreement
• Participation in European Commission pilot of methodologies
• Publication target date for GHG Protocol ICT sector supplement: February 2012
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
23
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Previously we ensured that sustainability activity with our customers was embedded into BT’s Climate Change Strategy
Our CEO Ian Livingston has now added a 6th strategic priority for the business:
Becoming ‘a responsible and sustainable business leader’
This means we need to continue to dedicate our efforts to helping our customers move to become more sustainable
Sustainability & our customers
Sir Michael Rake
Chairman
Ian Livingston
Chief Executive
Our commitment to being a leader in responsible and sustainable business goes beyond a statement of strategic intent and beyond managing our own social and environmental footprint
“ “
We’re also passionate about the role that BT can play in helping others to live and work more sustainably through our technology and the skills and expertise of our people“
“
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How we make it happen
Bid Responses•Support major bids where the solution to be delivered can have real sustainability benefits for the customer
•Includes £305m of Global Services bids in H1 of 2011/12
•Sustainability also has a major role to play in joint BT-Local Authority Superfast Broadband bids
Thought Leadership •Focus on understanding customer sustainability needs on a sectorised basis through engagement with account teams and customers
•Producing documentation and customer material to articulate the sustainable benefits of ICT solutions
•Focus in 2011/12 has been on the Public Sector as well as retail and supply chain
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Carbon Impact Assessment & Build a Sustainable Organisation
Quick re-cap from last year...
...This has been updated to include a more comprehensive picture of BT’s sustainable capabilities as well as providing supporting information for customers on the social, economic and environmental benefits of ICT for their business
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Implementation
Planning
Assessment
Monitoring
Build a Sustainable Organisation
SustainabilityConsulting
Wellbeing
Healthcare
Community
Energy Management
Building Energy
Management
Smart Grids
Smart Meters
Transport & Supply Chain
Transport Efficiency
AssetManagement
DataCentres
Virtual DataCentre
Services
Managed Hosting
Continuous MigrationPractice
CRM
Contact Centre
Efficiency
Next Generation
ContactCentre
Smart Customer
Interactions
IT Services
Operational Efficiency
Integrating Network & IT services
Professional Services (IT Audit)
Workforce
Flexible Workforce
Unified Comms
Mobility Solutions
Field ForceAutomation
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Case studiesWe continue to generate revenue through our Build a Sustainable Organisation Portfolio and helping our customers understand the sustainable benefits we can deliver for them
• Virtual Data Centre Services
• 600 physical servers reduced to 160 virtual and 130 physical
• 170 desktops virtualised
• Estimated 680 t CO2 emissions reduction
• Significant increase in business resilience
Caja Navarra Bank
• BT Building Energy Efficiency (Green Branch)
• Internal rate of return of 11.7 %• Approximately £10,000 savings per branch per year• Average 25% reduction in KWh
2010/11
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i. Unilever Resign• Bid submission included
Sustainability consulting to create a joint Green IT Roadmap.
• Collaborated with Unilever on embedding Green IT into service delivery.
• New sales channel opened up
• Sustainability training is now mandatory for key
ii. Project Firefox• Key requirement was
to measure the impact of the solution
• Sustainability design principles developed to help guide Solution Architects
• Sustainability governance built into the contract
iii. Environment Agency
• Greenest Contract in UK Government
• Targets with Teeth• 3 Sustainability Gates• Power Consumption• Travel Reduction• Sweating Assets to give
longer life
• As part of our contract re-sign we committed to creating and delivering on a joint Green IT Roadmap.
• Collaborate with Unilever on embedding Green IT into service delivery.
• Sustainability training is now mandatory for key staff working on the contract
Continue to work with Unilever to support their sustainable objectives through investigating opportunities such as:
•Asset Management (RFID)•Building Energy Management Systems•Transport Efficiency
Sustainable partnerships with customers
+ N3 = Sustainability
The N3 team works closely with the NHS to find ways of utilising broadband to reduce emissions
•West London Cancer Network utilises the N3 network to transform their organisation using video-conferencing•The Cornwall & Isles of Scilly Community of Interest Network uses N3 to link distant sites together to enable remote patient care•The Kent Cardiovascular Network uses N3 to send images in real time to specialists across London
Supporting Unilever’s Sustainable Living Plan
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Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
30
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The future of business leadership
• The new industrial revolution
– Resource based
– Winners & losers
• The challenge
– between now and 2020 every tonne of CO2 emitted needs to deliver 5 times the economic value
Winners will succeed by:
– aligning sustainability & innovation together
– growing a top-line that resolves (as oppose to creates) humanities greatest challenges
– behaving much more like a business eco-system:
• better networks with customers & suppliers
• cross industry collaboration to create scalable solutions that can serve the needs of 10bn+ people
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The future of business leadership
The need for systemic change
– more conscientious consumption models, in the home (M2M & SmartReach and/or Fibre) and at an individual level.
– more scalable & resilient supply chains (RFID enabling transparency and traceability) enabling the eradication of waste & optimisation of resources. From supply chains to supply loops.
– The innate social value of a more connected society (adapt, overcome & evolve)
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Cool broadband
• Always available vs. always on
• Lines automatically switch to low-power during low-traffic
• Potential energy saving 30% per line card
• No impact on service
• Customer trials successful
• Working with vendors on development plan
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Smart cities
•Wireless
•Fibre telecomms
•Remote sensor
•Machine-to-machine
•Cloud services
•Conferencing
•Web technologies
Our existing network means we’re ideally placed to help cities become smarter:
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Developing smart technologies
• Helping to create low-carbon communities • Smart meters & smart grids
– Real-time electricity, gas & water use – Better planning possible via Smart grid intelligence
• SmartReach– BT part of consortium created to support governments
commitment to roll our smart meters to 28 million homes & SMEs by 2020
– New, secure wireless network via long range radio waves
• Smartgrid Ireland – founding partner • Smart Grid system in North America
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SmartReach trial activity
• Ready trial launched in July 2010
• In part, DECC fund
• Covers 80 sq. km and
200,000 homes
• Triallists exploring performance
of Smart energy & water meters.
• SmartReach also engaged in
trials regarding Smart Grid &
demand management
applications
© British Telecommunications plc
Agenda
1. Welcome & introduction
• Niall Dunne, chief sustainability officer
2. Energy & carbon reduction
• Richard Tarboton, director of energy & carbon
3. Supply chain
• Liz Cross, CSR & governance for procurement
4. Carbon footprinting & driving industry standards
• Gabrielle Giner, environmental sustainability programme manager
5. Global Services Sustainability Practice & case study
• Simon O’Neill, market strategy & development
6. The age of smart
• Niall Dunne, chief sustainability officer
7. Q&A panel session
37
© British Telecommunications plc
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