Dell: the world's greenest tech company or too little, too late

IT giant Dell chose World Environment Day today to announce a major new environmental initiative that the company claimed would make it "the greenest technology company on earth".

Under the new Zero Carbon Initiative the company pledged to enhance the energy efficiency of its products and help customers offset their carbon impact, reduce the "carbon intensity" of its operations, extend its popular "Plant a Tree for Me" customer carbon offset scheme to Europe, increase pressure on suppliers to improve their environmental credentials, and work with customers to develop more environmentally sustainable products.

Speaking to mark the launch of the new initiative Dell chairman and CEO Michael Dell said that the company's goal was clear: "We'll take the lead in setting an environmental standard for our industry that will reflect our partnership with, and direct feedback from, our customers, suppliers and stakeholders, and we intend to maintain that leadership."

However, the strategy is likely to prompt a mixed reaction from environmentalists and green consumers, combining as it does several innovative environmental proposals with some rather vague green commitments.

Dell signaled that a core part of the new strategy would centre on the company's direct engagement with customers and announced that it would ask customers for ideas on how to make "the greenest PC on the planet" that they could put forward on its IdeaStorm customer forum site.

The idea was welcomed by Iza Kruszewska of Greenpeace who said that the Dell announcement coupled with recent environmental commitments from rival manufacturer Apple highlighted how seriously customers and IT companies are now taking environmental concerns. "Dell's goal to build the greenest PC on the planet sets a new challenge to the industry," she said. "The race for the greenest computer is clearly on."

The company also announced it would extend its "Plant a Tree for Me" initiative to Europe, offering customers the opportunity to pay £1 per notebook or £3 per desktop to offset the emissions associated with powering the new equipment over its average three year lifespan. The company said that 100 percent of the funds raised would go towards the planting of trees in professionally managed reforestation projects and added that Michael Dell would personally match all donations to the program received in the next three months. 

Furthermore, Dell can expect to win plaudits for its commitment to begin assessing its primary suppliers' performance based on carbon emissions. Under the new proposals the company has requested that suppliers begin reporting on their greenhouse gas emissions with the data feeding into the quarterly business reviews which the company uses to gauge its suppliers' performance.

"We have multiple sections in our quarterly business reviews, including cost, quality, continuity and the environment," said Tod Arborgast, director of sustainable business at Dell. "Each element [of the quarterly reviews] is aggressively focused on by our suppliers and they know that each point, including performance on greenhouse gas emission, counts towards our purchasing decisions."

However, while the scheme has been broadly welcomed, environmentalists are likely to criticise the company for failing to release an absolute emissions reduction target.

Under the new proposals Dell has committed to reduce its "carbon intensity" - a measure which compares emissions of CO2 equivalent to annual revenue allowing firms to assess how efficient they are at turning carbon emissions from their operations into revenue – by 15 percent by 2012, but neglected to set itself a absolute target for CO2 reduction.

This would in theory allow Dell to hit its target while increasing carbon emissions as long as efficiency improved and sales increased considerably.

In contrast, arch rivals HP recently committed to cutting total carbon emissions by 15 percent by 2010, Sun Microsystems pledged to reduce emissions by 20 percent by 2012 and IBM recently committed to spending $1bn a year to double the computing capacity of its datacentres without increasing its emissions.

John Madden of analyst firm Ovum said that the Dell pronouncements appeared vaguer than some of the green strategies unveiled by its rivals. "HP, Sun and IBM lately have been much more explicit in terms of attacking green issues, particularly around carbon emissions, than what's laid out here from Dell," he said. "Dell I'm sure is serious about the issue - but we'll have to watch and see just what develops from this announcement."

Rakesh Kumar of analyst firm Gartner went further still, branding Dell's plans a case of too little, too late. "It is a very bold claim [to say it is the greenest technology company] that needs a huge amount of substantiation and in many ways it just shows how these wild claims damage the industry more than anything else," he said.

However, Arborgast insisted that carbon intensity was the best way of comparing firms' carbon emission performance across different companies and industry sectors, adding that using this measure Dell's greenhouse gas impact is among the lowest of those companies listed on the Fortune 50 that have publicised their carbon emissions through the .

He argued that the company's streamlined supply chain meant that its total carbon emissions were already significantly lower than many of its rivals and because its operations already boasted strong energy efficiency it would find it difficult to deliver deep cuts in absolute emissions until more renewable energy supply came on line.

"We will continue to focus on reducing our absolute [emissions] output and sourcing renewable energy where possible," he said. "But you need to look at where the baseline is before comparing different vendor's emission cuts and carbon intensity is the best way of comparing performance."

It is a reasonable argument, but one that will not stop some environmentalists and competitors arguing that for all its good work Dell will have to set itself far more stringent emission targets if it is to be genuinely regarded as the "greenest technology company on earth".

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